Survival of the fittest: tourism exposure and firm survival

In this article, a discrete-time hazard model to study firm survival in the Portuguese Tourism sector is estimated. This sector has experienced a remarkable performance over the last decades. Results show that when compared to other sectors, tourism firms are more likely to exit: (i) if they are you...

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Bibliographic Details
Published in:Applied economics 2023-12, Vol.55 (60), p.7150-7177
Main Authors: Caires, Filipe B., Reis, Hugo, Rodrigues, Paulo M. M.
Format: Article
Language:English
Subjects:
Companies
Economic theory
Firm dynamics
Firm survival
Hazard model
Resilience
Tourism
Tourism exposure
Uncertainty
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Summary:In this article, a discrete-time hazard model to study firm survival in the Portuguese Tourism sector is estimated. This sector has experienced a remarkable performance over the last decades. Results show that when compared to other sectors, tourism firms are more likely to exit: (i) if they are young (less than 10 years of existence); and (ii) if they belong to the group of worse performers (i.e. belong to the lower tail of the firm distribution). Within tourism related sectors, firms with highest tourism exposure, such as travel agencies and hotels are always among the best performers in terms of survival. Moreover, despite of Tourism being one of the most volatile sectors in periods of high uncertainty, results show a higher survival resilience among established tourism associated firms.
ISSN:0003-6846
1466-4283
DOI:10.1080/00036846.2023.2208858