Frontiers of Entrepreneurship Research
1997 Edition

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AN EXAMINATION OF THE NATURE OF BUSINESS CLOSINGS: ARE THEY REALLY FAILURES?

Julio O. De Castro, University of Colorado/Boulder

Sharon A. Alvarez, University of Colorado/Boulder

James D. Blasick, University of Colorado/Boulder

Marina Ortiz, Fondomicro. Santo Domingo, Dominican Republic


INTRODUCTION

LITERATURE AND THEORETICAL BACKGROUND

The Literature on Business Failures
Theoretical Background

METHODOLOGY

Sample and Data Collection
Analysis
TABLE 1
TABLE 2
TABLE 3
TABLE 4

RESULTS

DISCUSSION

REFERENCES

APPENDIX

Independant Variable
Dependant Variables

 

ABSTRACT

Entrepreneurship studies typically identify small business closures as business failures. Existing research is problematic because of the current definition of failures and the way failures have been measured in the past. This paper differentiates between failures and closures, and examines the characteristics of each using a national sample of micro enterprises in the Dominican Republic. Our findings revealed that 50% of the closed businesses should not be classified as failures. Using a discriminant analysis, we find that the occupation taken after firm disappearance, is the most significant predictor distinguishing between outright failure and other forms of closure.

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