A comparative study of exiting and surviving firms in the Czech economy in the late 1990s

We address the issue of whether the development of the bankruptcies assisted the general recovery of the Czech economy in the late 1990s. Several similarities were observed between exiting and surviving firms in, for example, 1999 in terms of operating results (labor productivity, value-added per employee, average wage). We believe, rather, that firms' privatization histories and the financial costs connected to these histories, not the operating results, were the most relevant factors for the exiting process. We also compared surviving and exiting firms with regards to branch, territorial, and institutional structure. Surprisingly, the most resilient were the agriculture and energy sectors, and the highest degree of bankruptcies was documented in the Prague region, which has the highest GDP per capita.