The present article provides first microlevel (indirect) empirical evidence on changes in entry barriers, the determinants of firm profitability as well as the nature of competition for a transition economy. We estimate size thresholds required to support different numbers of firms for several retail and professional service industries in a large number of geographic markets in Slovakia. The 3 time periods in the analysis (1995, 2001 and 2010) characterize different stages of the transition process. Specific emphasis is given to spatial spill-over effects between local markets. Estimation results obtained from a spatial ordered probit model suggest that entry barriers have declined considerably (except for restaurants) and that the intensity of competition has increased on average. We further find that demand spill-overs and/or the effects associated with a positive correlation in unobservable explanatory variables seem to outweigh negative spill-over effects caused by competitive forces between neighbouring cities and villages. The importance of these spatial spill-over effects differs across industries.
| Identifer | oai:union.ndltd.org:VIENNA/oai:epub.wu-wien.ac.at:5799 |
| Date | January 2018 |
| Creators | Labaj, Martin, Morvay, Karol, Silanic, Peter, Weiss, Christoph, Yontcheva, Biliana |
| Publisher | Taylor & Francis |
| Source Sets | Wirtschaftsuniversität Wien |
| Language | English |
| Detected Language | English |
| Type | Article, PeerReviewed |
| Format | application/pdf |
| Rights | Creative Commons: Attribution 4.0 International (CC BY 4.0) |
| Relation | http://dx.doi.org/10.1080/00036846.2017.1374535, http://www.tandfonline.com/, http://orcid.org/0000-0001-6269-1407, http://epub.wu.ac.at/5799/ |
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