دانلود رایگان مقاله نرخ ارز و بقای شرکت: آزمون با داده های سطح شرکت ترکیه

Abstract

Micro-level empirical research has begun to obtain important results on the effects of currency variations on firms’ survival. The literature has, however, lacked a detailed analysis of the effects of exchange rates on firms’ survival behavior in emerging markets due to a scarcity of firm-level information. Using a firm-level dataset, we investigate the impact of currency appreciation on the survival behavior of Turkish firms in the manufacturing industries for 2002–2009. Our results suggest that real exchange rate appreciation decreases the probability of survival in the manufacturing industries. We also find that high-productivity firms have a higher probability of survival than low-productivity firms following an appreciation of the exchange rate. Our findings indicate that the negative effect of a 1% real appreciation of the domestic currency on the survival probability of a given firm ranges from 4.5 to 9%, providing evidence for the vulnerability of developing countries to exchange rate movements. This evidence indicates that, especially for emerging market economies, economic events and policies leading to an appreciation in the domestic currency should be managed cautiously.

5. Conclusion

The results of the empirical research presented in this paper provide some evidence of the impact of real exchange rate variations on the survival behavior of firms in Turkish manufacturing industries. Our results suggest that currency appreciation decreases the probability of survival for manufacturing firms. Consistent with the implications of the Melitz (2003) model, real exchange rate appreciation puts domestic producers at a cost disadvantage in export markets, raising the level of competition faced by these exporting firms. Consequently, the least productive firms exit the market. We find evidence that high-productivity firms have higher probabilities of survival than low-productivity firms in the presence of exchange rate variation. It should be reemphasized that, unlike in some previous studies, survival is defined in this study not only as remaining active in export markets but also as staying in business irrespective of the market at which these firms’ products are targeted. Therefore, when the firms considered in this study are faced with exchange rate appreciation, they do not seem to be successful in compensating for their profit losses in export markets by relying on domestic demand, and are forced to exit.