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Accessible Unlicensed Requires Authentication Published by De Gruyter November 24, 2005

Competition Policy and Exit Rates: Evidence from Switzerland

Stefan Buehler, Christian Kaiser and Franz Jaeger

This paper provides evidence on the relation between the intensity of product-market competition and the probability of exit. We adopt a natural experiment approach to analyze the impact of a tightening of Swiss antitrust legislation on exit probabilities. Based on a sample of more than 68,000 firms from all major sectors of the Swiss economy, we find that the exit probability of non-exporting firms increased significantly, whereas the exit probability of exporting firms remained largely unaffected. Our results support the notion that there is a positive relationship between the intensity of product-market competition and the probability of exit.

Published Online: 2005-11-24

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