IDEAS home Printed from https://ideas.repec.org/a/mbr/jmonec/v15y2020i1p25-34.html
   My bibliography  Save this article

Analyzing the Impact of Leverage Rate on Export Survival: The Case of Iranian Firms

Author

Listed:
  • Mojdeh , Zahra

    (Department of Economics, Mazandaran University)

  • Tehranchian , Amir Mansour

    (Department of Economics, Mazandaran University)

  • Jafari Samimi , Ahmad

    (Department of Economics, Mazandaran University)

  • Rasekhi , Saeed

    (Department of Economics, Mazandaran University)

Abstract

One of the goals of the government is to increase the competitiveness of domestic firms to export goods and services. Moreover, the role of exports in many economic sectors has been emphasized. There are two essential requirements for developing non-oil exports: first, the presence of firms in export markets and increasing their competitiveness; second, the survival of them in international markets. This paper assesses the impact of leverage on export survival by using the data of 16 Iranian manufacturing firms from 1999-2018. These companies operate in the agricultural and food industry and are indexed in the stock exchange market. Based on Cox semi-parametric model estimation, the main result is that leverage harms export survival.

Suggested Citation

  • Mojdeh , Zahra & Tehranchian , Amir Mansour & Jafari Samimi , Ahmad & Rasekhi , Saeed, 2020. "Analyzing the Impact of Leverage Rate on Export Survival: The Case of Iranian Firms," Journal of Money and Economy, Monetary and Banking Research Institute, Central Bank of the Islamic Republic of Iran, vol. 15(1), pages 25-34, January.
    • Handle: RePEc:mbr:jmonec:v:15:y:2020:i:1:p:25-34
    as

    Download full text from publisher

    File URL: http://jme.mbri.ac.ir/article-1-481-en.pdf
    Download Restriction: no
    File URL: http://jme.mbri.ac.ir/article-1-481-en.html
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. Senbet, Lemma W. & Wang, Tracy Yue, 2012. "Corporate Financial Distress and Bankruptcy: A Survey," Foundations and Trends(R) in Finance, now publishers, vol. 5(4), pages 243-335, August.
    2. Maes, Elisabeth & Dewaelheyns, Nico & Fuss, Catherine & Van Hulle, Cynthia, 2019. "The impact of exporting on financial debt choices of SMEs," Journal of Business Research, Elsevier, vol. 102(C), pages 56-73.
    3. Bernard, Andrew B. & Bradford Jensen, J., 1999. "Exceptional exporter performance: cause, effect, or both?," Journal of International Economics, Elsevier, vol. 47(1), pages 1-25, February.
    4. Nina Pavcnik, 2002. "Trade Liberalization, Exit, and Productivity Improvements: Evidence from Chilean Plants," The Review of Economic Studies, Review of Economic Studies Ltd, vol. 69(1), pages 245-276.
    5. Armando Silva, 2011. "Financial Constraints and Exports: Evidence from Portuguese Manufacturing Firms," International Journal of Business and Economic Sciences Applied Research (IJBESAR), Democritus University of Thrace (DUTH), Kavala Campus, Greece, vol. 4(3), pages 7-19, December.
    6. Daniela-Emanuela Danacica & Ana-Gabriela Babucea, 2010. "Using Survival Analysis In Economics," Analele Stiintifice ale Universitatii "Alexandru Ioan Cuza" din Iasi - Stiinte Economice (1954-2015), Alexandru Ioan Cuza University, Faculty of Economics and Business Administration, vol. 57, pages 439-450, november.
    7. Chaney, Thomas, 2016. "Liquidity constrained exporters," Journal of Economic Dynamics and Control, Elsevier, vol. 72(C), pages 141-154.
    8. Jen Baggs & James A Brander, 2006. "Trade liberalization, profitability, and financial leverage," Journal of International Business Studies, Palgrave Macmillan;Academy of International Business, vol. 37(2), pages 196-211, March.
    9. Sarah Bridges & Alessandra Guariglia, 2008. "Financial Constraints, Global Engagement, And Firm Survival In The United Kingdom: Evidence From Micro Data," Scottish Journal of Political Economy, Scottish Economic Society, vol. 55(4), pages 444-464, September.
    10. Nakhoda, Aadil, 2012. "The influence of financial leverage of firms on their international trading activities," MPRA Paper 35765, University Library of Munich, Germany.
    11. repec:hal:spmain:info:hdl:2441/5g3sadr9h8gbri8hrtq0h6au2 is not listed on IDEAS
    12. Eghbalnia , Mohammad & Fadayinejad , Mohammad Esmaeel & Noferesti , Mohammad, 2013. "The Impact of Leverage on Firm Investment: Evidence from Tehran Stock Exchange," Journal of Money and Economy, Monetary and Banking Research Institute, Central Bank of the Islamic Republic of Iran, vol. 8(4), pages 59-73, October.
    13. Haeng-Sun KIM, 2016. "Firms' leverage and export market participation: Evidence from South Korea," International Economics, CEPII research center, issue 148, pages 41-58.
    14. Marc J. Melitz, 2003. "The Impact of Trade on Intra-Industry Reallocations and Aggregate Industry Productivity," Econometrica, Econometric Society, vol. 71(6), pages 1695-1725, November.
    15. Pinto, João M. & Silva, Cátia S., 2021. "Does export intensity affect corporate leverage? Evidence from Portuguese SMEs," Finance Research Letters, Elsevier, vol. 38(C).
    16. Haeng-Sun Kim, 2016. "Firms’ Leverage and Export Market Participation: Evidence from South Korea," Working Papers halshs-01643899, HAL.
    17. KIM(KILF), Haeng-Sun, 2016. "Firms' leverage and export market participation: Evidence from South Korea," International Economics, Elsevier, vol. 148(C), pages 41-58.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Joachim Wagner, 2016. "Credit Constraints and Exports: A Survey of Empirical Studies Using Firm Level Data," World Scientific Book Chapters, in: Microeconometrics of International Trade, chapter 12, pages 401-421, World Scientific Publishing Co. Pte. Ltd..
    2. Federico J. Diez & Jesse Mora & Alan C. Spearot, 2016. "Firms in international trade," Working Papers 16-25, Federal Reserve Bank of Boston.
    3. Joachim Wagner, 2014. "Credit constraints and exports: evidence for German manufacturing enterprises," Applied Economics, Taylor & Francis Journals, vol. 46(3), pages 294-302, January.
    4. Murphy, Gavin & Siedschlag, Iulia, 2016. "Exporting under Financing Constraints: Firm-level Evidence from EU Countries," Papers WP530, Economic and Social Research Institute (ESRI).
    5. Elhanan Helpman, 2010. "Labor Market Frictions as a Source of Comparative Advantage, with Implications for Unemployment and Inequality," NBER Working Papers 15764, National Bureau of Economic Research, Inc.
    6. Catherine Fuss & Angelos Theodorakopoulos, 2018. "Compositional Changes in Aggregate Productivity in an Era of Globalisation and Financial Crisis," Working Papers of VIVES - Research Centre for Regional Economics 627696, KU Leuven, Faculty of Economics and Business (FEB), VIVES - Research Centre for Regional Economics.
    7. Abbas Aminifard Author_Email: aaminifard@yahoo.com & Karim Azarbaijani & Seyed Komail Tayebi, 2011. "Trade Liberalization And Unobservable Productivity In Iran'S Manufacturing Industry: An Application Of Olley -Peaks Approach," 2nd International Conference on Business and Economic Research (2nd ICBER 2011) Proceeding 2011-252, Conference Master Resources.
    8. Breinlich, Holger, 2008. "Trade liberalization and industrial restructuring through mergers and acquisitions," Journal of International Economics, Elsevier, vol. 76(2), pages 254-266, December.
    9. Chacha, Peter Wankuru & Kirui, Benard Kipyegon & Wiedemann, Verena, 2024. "Supply Chains in Times of Crisis: Evidence from Kenya’s Production Network," World Development, Elsevier, vol. 173(C).
    10. Paul S. Segerstrom & Ignat Stepanok, 2018. "Learning How To Export," Scandinavian Journal of Economics, Wiley Blackwell, vol. 120(1), pages 63-92, January.
    11. Massimo Del Gatto & Gianmarco I. P. Ottaviano & Marcello Pagnini, 2008. "Openness To Trade And Industry Cost Dispersion: Evidence From A Panel Of Italian Firms," Journal of Regional Science, Wiley Blackwell, vol. 48(1), pages 97-129, February.
    12. Beverly Lapham & Hiroyuki Kasahara, 2005. "Import Protection as Export Destruction," 2005 Meeting Papers 528, Society for Economic Dynamics.
    13. Filipe Silva & Carlos Carreira, 2011. "Financial Constraints and Exports: An Analysis of Portuguese Firms During the European Monetary Integration," Notas Económicas, Faculty of Economics, University of Coimbra, issue 34, pages 35-56, December.
    14. Joel Rodrigue, 2014. "Multinational Production, Exports and Aggregate Productivity," Review of Economic Dynamics, Elsevier for the Society for Economic Dynamics, vol. 17(2), pages 243-261, April.
    15. Giordano, Claire & Lopez-Garcia, Paloma, 2019. "Firm heterogeneity and trade in EU countries: a cross-country analysis," Occasional Paper Series 225, European Central Bank.
    16. Fugazza, Marco & Robert-Nicoud, Frédéric, 2006. "Can South-South trade Liberalisation Stimulate North-South Trade ?," Journal of Economic Integration, Center for Economic Integration, Sejong University, vol. 21, pages 234-253.
    17. Beata S. Javorcik & Mariana Spatareanu, 2009. "Tough Love: Do Czech Suppliers Learn from their Relationships with Multinationals?," Scandinavian Journal of Economics, Wiley Blackwell, vol. 111(4), pages 811-833, December.
    18. Finicelli, Andrea & Pagano, Patrizio & Sbracia, Massimo, 2013. "Ricardian selection," Journal of International Economics, Elsevier, vol. 89(1), pages 96-109.
    19. Haas, Levi & Schenk-Hoppé, Klaus R., 2019. "International Trade: Smarten up to talk the talk," MPRA Paper 99096, University Library of Munich, Germany.
    20. Gregory Corcos & Massimo Del Gatto & Giordano Mion & Gianmarco I.P. Ottaviano, 2012. "Productivity and Firm Selection: Quantifying the ‘New’ Gains from Trade," Economic Journal, Royal Economic Society, vol. 122(561), pages 754-798, June.

    More about this item

    Keywords

    Export survival; Leverage; Firm Heterogeneity; Cox Semi-Parametric Model;
    All these keywords.

    JEL classification:

    • G30 - Financial Economics - - Corporate Finance and Governance - - - General
    • G33 - Financial Economics - - Corporate Finance and Governance - - - Bankruptcy; Liquidation
    • F12 - International Economics - - Trade - - - Models of Trade with Imperfect Competition and Scale Economies; Fragmentation

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:mbr:jmonec:v:15:y:2020:i:1:p:25-34. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: M. E. (email available below). General contact details of provider: https://edirc.repec.org/data/mbcbiir.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.