The Performance of German Firms in the Business-Related Service Sectors: A Dynamic Analysis

45 Pages Posted: 9 Nov 2003

See all articles by Nguyen Van Phu

Nguyen Van Phu

University of Angers - Bureau of Economic Theory and Application (BETA)

Ulrich Kaiser

University of Southern Denmark - Faculty of Social Sciences; Center for Economic and Business Research (CEBR); Centre for European Economic Research

Francois Laisney

ZEW – Leibniz Centre for European Economic Research

Date Written: 2000

Abstract

We analyze the performance of firms in the German business-related services sector. A quarterly business survey provides the panel data base of our study. Firm performance is measured by the survey respondents' ordinal indication of their changes in total sales. We use a firstorder Markov chain and a multinomial logit specification to model the transition probabilitites. Three variants of the model are estimated: A linear index model with and without unobserved firm heterogeneity and a semiparametric model. Main results are that firm size has a positive effect on firm performance, that young firms outperform older competitors, that a bank-relationship with a single creditor has a stabilizing effect and that the degree of diversification has a negative impact on firm performance. The legal status appears to have no significant effect.

Keywords: Markov chain, service sector, business survey, firm performance, multinomial logit model, generalized additive model

JEL Classification: L89, C23, C14

Suggested Citation

Phu, Nguyen Van and Kaiser, Ulrich and Laisney, Francois, The Performance of German Firms in the Business-Related Service Sectors: A Dynamic Analysis (2000). ZEW Discussion Paper No. 00-32. Available at SSRN: https://ssrn.com/abstract=373921 or http://dx.doi.org/10.2139/ssrn.373921

Nguyen Van Phu

University of Angers - Bureau of Economic Theory and Application (BETA) ( email )

61 avenue of the Black Forest
F-67085 Strasbourg Cedex
France

Ulrich Kaiser (Contact Author)

University of Southern Denmark - Faculty of Social Sciences ( email )

Campusvej 55
DK-5230 Odense M
Denmark

HOME PAGE: http://www.sam.sdu.dk/staff/uka

Center for Economic and Business Research (CEBR) ( email )

Porcelaenshaven, Bldg 65
DK-2000 Frederiksberg
Denmark

HOME PAGE: http://www.cebr.dk/uk

Centre for European Economic Research ( email )

P.O. Box 10 34 43
L 7,1 D-68161 Mannheim
Germany

HOME PAGE: http://www.zew.de/de/mitarbeiter/mitarbeiter.php3?action=mita&kurz=uka

Francois Laisney

ZEW – Leibniz Centre for European Economic Research ( email )

P.O. Box 10 34 43
L 7,1
D-68034 Mannheim, 68034
Germany

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