http://repub.eur.nl/res/aut/13870/ List of Publications en http://repub.eur.nl/static-eur/img/logo.png http://repub.eur.nl http://repub.eur.nl/res/pub/21731/ 2010-09-01T00:00:00Z This paper examines the impact of globalisation, by means of growing international trade, on firm entry and exit at the industry level. The analysis is carried on the manufacturing industries of eight European countries, over the period 1997–2003. Our main findings suggest important entry-discouraging effects in the short run, following increased trade exposure. Using panel estimation techniques, the empirical evidence points to less creative replacement entry in industries characterised by substantial import intensity, and strong selection and higher entry barriers in industries characterised by higher openness through the export channel. The negative effects of trade openness are milder if the increasing trade exposure concerns intra-industry trade, coupled mainly with international sourcing of intermediates within the industry. The latter effects also show up in the model explaining the exit of firms, which we estimate jointly with entry. http://repub.eur.nl/res/pub/14160/ 2008-12-01T00:00:00Z This paper analyzes the impact of globalization on the exit behavior of manufacturing firms in Belgium. Imports from low-wage countries are found to exert a strong competitive effect, which raises the likelihood of exit of firms in industries where intra-industry trade is relatively low. Similar to import competition, growing penetration by multinational firms in the industry has an equally strong competitive impact on the likelihood of exit of domestic firms. However, Belgian firms that offshore activities to non-European Union countries are able to substantially improve their chances of survival. This also holds for subsidiaries of multinational enterprises operating in Belgium. Unlike domestic firms, the likelihood of exit of subsidiaries of multinational enterprises is found to be less sensitive to domestic market conditions in the host country. http://repub.eur.nl/res/pub/12065/ 2007-04-01T00:00:00Z Pressured by globalizing economies and growing international competition, an increasing number of firms are forced to rationalize productive operations. Especially poorly performing firms need to improve their profitability through downsizing or relocating their operations, which in many cases causes collective employee layoffs. This article adds to the emergent literature on the consequences of downsizing by looking into the determinants of collective employee layoffs. Based on a unique sample of Belgian firms reporting collective layoffs this article analyzes the firm's decision to dismiss all employees (exit), a significant proportion of its employees without creating new employment elsewhere (downsizing), or to move production abroad (international relocation). We theoretically derive the conditions under which a firm prefers one strategy to another. The empirical results confirm that relocating firms are most profitable among the restructuring firms, have invested more in the recent past, operate in sectors with significant economies of scale and belong more often to a multinational group than firms opting for downsizing or exit. Downsizing firms are more capital intensive than relocating firms, while exiting firms are less profitable, smaller, younger, and more labor intensive than downsizing or relocating firms. http://repub.eur.nl/res/pub/12067/ 2006-09-01T00:00:00Z The flexible relocation of capacity across countries by multinational enterprises has become an important source of concern. Using a unique sample of relocating firms in Belgium, we find that wages and market potential of host regions are important determinants for the location choice. Considering firm characteristics, we show that large firms have a higher propensity to relocate to remote countries. Public aid only plays a decisive role in the investment decision for relocations to adjacent countries, suggesting a potential harmful role in distorting competition. More proactive policies in line with changing comparative location advantages should be implemented to accommodate relocations. http://repub.eur.nl/res/pub/12082/ 2000-01-01T00:00:00Z This article is the first to explore the determinants of international relocation of a firm. It is found that labour intensive firms in a highly industrialized and open economy such as Belgium tend to relocate more to other countries than their highly productive capital intensive counterparts. Access to a global network, firm size, and the rate of innovation have a positive effect on the probability of relocation. Uncertainty has a negative impact on the probability of relocation. The positive effect of firm size and profitability on the relocation decision is clearly distinct from its effect on the exit decision of a firm.