Net Entry of Firms into Greek Manufacturing: The Effects of Business Conditions

Net Entry of Firms into Greek Manufacturing: The Effects of Business Conditions This research explores the nature and causes of net entry into manufacturing industry in Greece. Previous work has rarely considered these issues in the context of small, but open, and not particularly industrialised economies. The exact nature of the focus of interest – net entry – is discussed first, illustrating that this is a complex variable to account for, although arguably still interesting and useful. Net entry needs to be considered as variable worthy of study in its own right as it reflects an outcome of processes of gross entry and exit. Certainly it need not be interpreted only as entry as is often the case. Next comes the question of the degree of variation, both temporally and sectorally, that net entry exhibits in the context of contemporary Greek manufacturing. Some temporal variation in net entry rates is demonstrated, and there follows a discussion of how such variation might be explained potentially in theory. The empirical testing of these hypotheses point to findings that are different to those discovered in different contexts. For Greek manufacturing, profitable business opportunities were not shown to be a sufficient condition of higher net entry, but the cost advantages of large scale operations did both encourage entry and discourage exit. The cost of capital and the overall condition of the economy were negatively related to net entry. However the role of industry growth, import penetration and export orientation tend to confirm findings in other studies. http://www.deepdyve.com/assets/images/DeepDyve-Logo-lg.png Small Business Economics Springer Journals

Net Entry of Firms into Greek Manufacturing: The Effects of Business Conditions

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Publisher
Kluwer Academic Publishers
Copyright
Copyright © 1997 by Kluwer Academic Publishers
Subject
Business and Management; Management; Microeconomics; Entrepreneurship; Industrial Organization
ISSN
0921-898X
eISSN
1573-0913
D.O.I.
10.1023/A:1017938904186
Publisher site
See Article on Publisher Site

Abstract

This research explores the nature and causes of net entry into manufacturing industry in Greece. Previous work has rarely considered these issues in the context of small, but open, and not particularly industrialised economies. The exact nature of the focus of interest – net entry – is discussed first, illustrating that this is a complex variable to account for, although arguably still interesting and useful. Net entry needs to be considered as variable worthy of study in its own right as it reflects an outcome of processes of gross entry and exit. Certainly it need not be interpreted only as entry as is often the case. Next comes the question of the degree of variation, both temporally and sectorally, that net entry exhibits in the context of contemporary Greek manufacturing. Some temporal variation in net entry rates is demonstrated, and there follows a discussion of how such variation might be explained potentially in theory. The empirical testing of these hypotheses point to findings that are different to those discovered in different contexts. For Greek manufacturing, profitable business opportunities were not shown to be a sufficient condition of higher net entry, but the cost advantages of large scale operations did both encourage entry and discourage exit. The cost of capital and the overall condition of the economy were negatively related to net entry. However the role of industry growth, import penetration and export orientation tend to confirm findings in other studies.

Journal

Small Business EconomicsSpringer Journals

Published: Sep 29, 2004

References

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