Determinants of Private SMEs Survival in China: Evidence from Zhejiang Province

Despite the ubiquity of private small and medium-sized enterprises(SMEs)in China, their lifecycle is always short. In this paper, we provide evidence for the determinants of private SMEs' lifecycle relying on enterprise surveys sampled during the period 2007-2008 in Zhejiang Province. Our empirical results indicate that firm size, technology, business environment and loans have significant influence on business survival, while profit performance, asset-liability ratio and family management make little sense. Then we take optimal-scaling regression analysis to further verify the firms with larger size, more quality certification, easier access to loans and engaging in capital-intensive or technology-intensive industry will get greater survival probability.