Open AccessThe Determinants of Firm Survival among Small Cluster Firms
Author(s) -
Sana Ullah,
Babur Wasim Arif,
Muhammad Tariq Majeed
Publication year - 2019
Publication title -
the lahore journal of economics
Language(s) - English
Resource type - Journals
eISSN - 1811-5446
pISSN - 1811-5438
DOI - 10.35536/lje.2019.v24.i1.a6
Subject(s) - social capital , probit model , probit , production (economics) , cluster (spacecraft) , economics , capital (architecture) , ordered probit , demographic economics , business , labour economics , marketing , economic growth , microeconomics , sociology , econometrics , social science , archaeology , computer science , programming language , history
This study analyzes the impact of education, experience, and social capital on firm survival using two waves of a survey conducted in 2008 and 2017 for the electrical fittings cluster based in Sargodha, Pakistan. Estimating a probit model, we find that the entrepreneur’s education, experience, and social network are each positively correlated with firm survival. The interactions of education with both production and marketing experience are also significantly and positively related to firm survival while interactions of social capital with experience are not. Therefore, for the firms in this sector, education plays an important role directly as well as through production and marketing experience.