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Firm Failure in Russia during Economic Crises and Growth : A Large Survival Analysis

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  • Iwasaki, Ichiro
  • Kim, Byung-Yeon

Abstract

In this paper, we trace the survival status of more than 110,000 Russian firms in the years of 2007–2015 and examine the determinants of firm survival across periods of economic crisis and growth. Applying the Cox proportional hazards model, we find that the effects of some variables regarded as key determinants of firm survival are not always robust across business cycles. Among the variables that constantly affect firm survival across business cycles and industries, concentration of ownership, the number of board directors and auditors, firm age, and business network are included. By contrast, the effects of some ownership-related variables on firm survival vary depending on the nature of economic recessions such as a global crisis and a local one. There is also evidence that an international audit firm increases the probability of firm survival; however, gaps in the quality between international audit firms and those from Russia decrease over time. These findings suggest that one should not make hasty generalizations regarding the determinants of firm survival by looking at a specific economic period or industry.

Suggested Citation

  • Iwasaki, Ichiro & Kim, Byung-Yeon, 2018. "Firm Failure in Russia during Economic Crises and Growth : A Large Survival Analysis," RRC Working Paper Series 76, Russian Research Center, Institute of Economic Research, Hitotsubashi University.
    • Handle: RePEc:hit:rrcwps:76
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    Cited by:

    1. Brock, Gregory, 2019. "A remote sensing look at the economy of a Russian region (Rostov) adjacent to the Ukrainian crisis," Journal of Policy Modeling, Elsevier, vol. 41(2), pages 416-431.
    2. Beata Bieszk-Stolorz & Krzysztof Dmytrów, 2021. "A survival analysis in the assessment of the influence of the SARS-CoV-2 pandemic on the probability and intensity of decline in the value of stock indices," Eurasian Economic Review, Springer;Eurasia Business and Economics Society, vol. 11(2), pages 363-379, June.

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    More about this item

    Keywords

    Firm failure; Economic crises and growth; Cox proportional hazards model; Russia;
    All these keywords.

    JEL classification:

    • D22 - Microeconomics - - Production and Organizations - - - Firm Behavior: Empirical Analysis
    • G01 - Financial Economics - - General - - - Financial Crises
    • G33 - Financial Economics - - Corporate Finance and Governance - - - Bankruptcy; Liquidation
    • G34 - Financial Economics - - Corporate Finance and Governance - - - Mergers; Acquisitions; Restructuring; Corporate Governance
    • P34 - Political Economy and Comparative Economic Systems - - Socialist Institutions and Their Transitions - - - Finance

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