Asset stripping and firm survival in mass privatization: testing the hoff-stiglitz and campos-giovannoni models in montenegro

We provide the first test of and find support for the Hoff-Stiglitz model of asset stripping during privatization. * We show the presence of asset stripping caused the more rather than less efficient firms to disappear. * We find support for endogenous exit of more productive and smaller firms. * We distinguish true start-ups from liquidated firms that re-appear as start-ups. * We show survival bias is important when estimating effects of privatization. We provide the first test of and find support for the Hoff and Stiglitz (2004a,b) model predicting under what conditions mass privatizations a... Mehr ...