Factors Determining the Success or Failure of Canadian Establishments on Foreign Markets: A Survival Analysis Approach

Abstract

This article uses the 1993–2000 Exporter Registry of Statistics Canada to study the factors conditioning the survival time of Canadian establishments on foreign markets. The probability of exit before 12 months is 42.2% and the median survival time is 20 months. The hazard of exit varies negatively with the relative size of the establishment, number of exported products and destinations, and the proportion of new entries into export episodes. Exporting to the US Eastern Seaboard represents a lower risk of exit than exporting to other US regions and any other destinations. Also, hazard rates vary across provinces and host industry. For example, belonging to an industry other than Manufacturing increases the risk of failure on foreign markets, except for Agriculture and Related Services as well as for Fishing and Trapping.

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