Currency Rates Prompt Micro-Manufacturer Exits
Mar 31st, 2008 | By Dawn Rivers Baker | Category: ResearchCurrency exchange rates have the most significant impact on those micro-manufacturers with fewer than ten employees, but that effect is largely (and understandably) confined to industries where import penetration is significant (5% or higher). At the same time, in addition to industries that do not face much international competition, smaller manufacturers seem to be insulated from negative impacts of international competition in so-called “high tech” industries. These were the major findings of a new research report, unexcitingly entitled The Impact of International Competition on Small-Firm Exit in U.S. Manufacturing, which was released by the SBA Office of Advocacy last week. Interestingly, the researcher notes that small firm exits happen for “idiosyncratic” reasons rather than for purely economic reasons. It is encouraging that economic researchers have begun to acknowledge that small business owners are people, too.
