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Rise and fall of the largest firms in Portugal

Cloé Magalhães
Mário Lourenço
Publication Year 
Several studies have been establishing stylized facts regarding firm entry and exit of the market. However, there is still limited evidence on the dynamics of top firms throughout very long periods of time. This article builds on a new database that records the largest firms operating in Portugal in terms of annual turnover. We consider the set of the top 200 firms in the period 1981-2018 and assess their dynamics across different classes in the ranking and the probability of exiting this group. The article concludes that there is more stability in terms of the firms placed in the top classes of the ranking. Moreover, on average, for different ranking classes and time horizons, the probability of rising in the rank is smaller than the probability to fall. The survival in the ranking differs according to the sector in which firms operate. Firms in the electricity and water supply sector survive for longer periods, while the median duration is lower in industry and construction.
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