Table 13.
Determinants of firm distress: estimation results of the first stage of a Heckman two-stage probit analysis with sample selection
| Target industry/sample restriction/region group | All industries | Agriculture, forestry, and fishing (Section A) | Mining, energy, and manufacturing (Sections B–E) | Construction (Section F) | Nonfinancial services (Sections G–J, L–S) | Financial services (Section K) | Central and Northwestern Federal Districts | Southern and North Caucasus Federal Districts |
|---|---|---|---|---|---|---|---|---|
| Model | Table 5 Model [1] | Table 6 Model [1] | Table 6 Model [3] | Table 6 Model [5] | Table 6 Model [7] | Table 6 Model [9] | Table 7 Model [1] | Table 7 Model [3] |
| Location in a monotown |
− 0.00883 (0.0233) |
0.08145 (0.1713) |
0.00188 (0.0400) |
0.00372 (0.0624) |
− 0.02205 (0.0330) |
0.35112 (0.4974) |
− 0.09395* (0.0542) |
− 0.02108 (0.1385) |
| Location in a monotown × Firm size | ||||||||
| Firms with less than 500 employees in monotowns | ||||||||
| Firms with 500–999 employees in monotowns | ||||||||
| Firms with 1000–4999 employees in monotowns | ||||||||
| Firms with 5000–9999 employees in monotowns | ||||||||
| Firms with 10000 or more employees in monotowns | ||||||||
| Location in a monotown × Federal state ownership | ||||||||
| Location in a monotown × Regional state ownership | ||||||||
| Open joint-stock company |
0.11989*** (0.0347) |
0.27948*** (0.1050) |
− 0.04862 (0.0629) |
0.01154 (0.1133) |
0.05176 (0.0582) |
0.25888 (1.8100) |
0.13458*** (0.0419) |
0.06757 (0.1509) |
| Closed joint-stock company |
0.03576 (0.0289) |
0.22167*** (0.0665) |
− 0.21390*** (0.0597) |
− 0.13823 (0.1032) |
0.15382*** (0.0456) |
1.10701 (1.7262) |
0.06766** (0.0345) |
− 0.16705 (0.1325) |
| Limited liability company |
0.07240*** (0.0272) |
0.12837* (0.0681) |
− 0.18184*** (0.0576) |
− 0.07266 (0.1003) |
0.18948*** (0.0422) |
0.80429 (1.7173) |
0.13210*** (0.0326) |
− 0.16318 (0.1216) |
| Large shareholding |
− 2.08197*** (0.0817) |
− 2.38015*** (0.2458) |
− 1.98538*** (0.1345) |
− 1.93356*** (0.2148) |
− 2.12917*** (0.1411) |
− 1.37802** (0.6524) |
− 1.96381*** (0.1001) |
− 6.60536*** (0.2554) |
| Foreign ownership |
− 0.02659 (0.0538) |
0.11240 (0.2654) |
− 0.10150 (0.0845) |
− 0.14970 (0.2835) |
0.02505 (0.0768) |
− 0.00564 (0.6062) |
− 0.10636* (0.0635) |
− 0.11031 (0.2470) |
| Federal state ownership |
0.23640*** (0.0374) |
0.44386*** (0.1212) |
0.21036*** (0.0576) |
0.02023 (0.1220) |
0.19651*** (0.0618) |
0.47758 (0.8075) |
0.29945*** (0.0502) |
0.06563 (0.1326) |
| Regional state ownership |
0.17948*** (0.0330) |
0.23564** (0.1123) |
− 0.05666 (0.0578) |
0.17024* (0.1022) |
0.32323*** (0.0510) |
− 0.80315 (1.3700) |
0.27301*** (0.0448) |
− 0.01739 (0.1243) |
| Managerial discretion |
0.00450*** (0.0012) |
− 0.01515** (0.0062) |
− 0.00872*** (0.0033) |
0.01051*** (0.0031) |
0.01023*** (0.0015) |
− 0.00658 (0.0332) |
0.00611*** (0.0016) |
− 0.00559 (0.0065) |
| Board size |
− 0.04847*** (0.0090) |
− 0.02203 (0.0458) |
− 0.05871*** (0.0126) |
− 0.07122*** (0.0250) |
− 0.03859** (0.0164) |
− 0.71201** (0.3159) |
− 0.03141*** (0.0103) |
− 0.06674* (0.0404) |
| Board size2 |
0.00197*** (0.0006) |
− 0.00248 (0.0040) |
0.00212*** (0.0008) |
0.00441** (0.0018) |
0.00264** (0.0013) |
0.05492** (0.0252) |
0.00107 (0.0007) |
0.00181 (0.0029) |
| International audit firm |
0.16699 (0.2232) |
0.15114 (0.2542) |
− 0.55419 (0.6637) |
0.38551 (0.2758) |
||||
| Large Russian audit firm |
0.01620 (0.1507) |
− 0.51997 (0.7199) |
− 0.00908 (0.2066) |
− 0.05306 (0.5920) |
0.25134 (0.2843) |
0.99899 (0.7900) |
− 0.40024 (0.2573) |
0.34730 (0.5294) |
| Local Russian audit firm |
0.18651*** (0.0592) |
− 0.22143 (0.3528) |
0.17872** (0.0740) |
0.02442 (0.2770) |
0.08098 (0.1371) |
− 0.00307 (0.0077) |
0.24577*** (0.0826) |
− 0.59112 (0.5026) |
| ROA |
− 0.00709*** (0.0003) |
− 0.00663*** (0.0023) |
− 0.00627*** (0.0007) |
− 0.00539*** (0.0008) |
− 0.00774*** (0.0004) |
− 0.01268*** (0.0048) |
− 0.00717*** (0.0004) |
− 0.00463*** (0.0011) |
| Gross margin |
− 0.00273*** (0.0004) |
− 0.00719*** (0.0018) |
− 0.00413*** (0.0008) |
− 0.00532*** (0.0010) |
− 0.00076* (0.0005) |
0.11473 (0.2940) |
− 0.00334*** (0.0004) |
− 0.00163 (0.0014) |
| Listing on the stock market |
0.15364** (0.0736) |
0.59362 (0.5158) |
0.06012 (0.0903) |
0.62087*** (0.1983) |
− 0.46856* (0.2444) |
− 0.00020 (0.0005) |
0.20410** (0.1041) |
− 0.03757 (0.2372) |
| Gearing |
0.00026*** (0.0000) |
0.00082*** (0.0002) |
0.00041*** (0.0001) |
0.00028*** (0.0001) |
0.00018*** (0.0000) |
− 0.00394 (0.0806) |
0.00027*** (0.0000) |
0.00024** (0.0001) |
| Firm size |
− 0.05833*** (0.0041) |
− 0.12579*** (0.0206) |
− 0.07260*** (0.0085) |
− 0.04295*** (0.0106) |
− 0.05367*** (0.0055) |
− 0.01580 (0.1777) |
− 0.05760*** (0.0051) |
− 0.05102*** (0.0171) |
| Firm age |
− 0.40813*** (0.0082) |
− 0.21277*** (0.0421) |
− 0.30741*** (0.0164) |
− 0.41191*** (0.0228) |
− 0.46901*** (0.0110) |
0.01103 (0.0322) |
− 0.42650*** (0.0107) |
− 0.32150*** (0.0318) |
| Business network |
− 0.01647*** (0.0026) |
− 0.00460 (0.0094) |
− 0.00917** (0.0046) |
− 0.03324*** (0.0077) |
− 0.01854*** (0.0039) |
0.02272 (0.0312) |
− 0.01878*** (0.0032) |
− 0.02420* (0.0128) |
| Business diversification |
0.00246* (0.0015) |
− 0.00337 (0.0051) |
0.00797*** (0.0029) |
0.00500 (0.0042) |
0.00072 (0.0020) |
1.41285 (2.0220) |
0.00582*** (0.0019) |
− 0.00126 (0.0055) |
| NACE division-level fixed effects | Yes | Yes | Yes | Yes | Yes | Yes | Yes | Yes |
| Target industry/sample restriction/region group | Volga and Ural Federal Districts | Siberian and Far East Federal Districts | Without Moscow Federal City, Moscow Region, St. Petersburg Federal City, and Leningrad Region | All industries | Without companies that failed in 2007–2009 | Without companies that failed in 2007–2012 | Without companies that failed in 2007–2015 | ||
|---|---|---|---|---|---|---|---|---|---|
| Model | Table 7 Model [5] | Table 7 Model [7] | Table 7 Model [9] | Table 8 Model [1] | Table 8 Model [3] | Table 8 Model [5] | Appendix Table 14 Model [1] | Appendix Table 14 Model [3] | Appendix Table 14 Model [5] |
| Location in a monotown |
− 0.03718 (0.0330) |
0.20788*** (0.0511) |
0.04265* (0.0239) |
− 0.03829 (0.1508) |
− 0.01736 (0.0245) |
− 0.01490 (0.0237) |
0.01239 (0.0245) |
− 0.03323 (0.0307) |
|
| Location in a monotown × Firm size |
0.00293 (0.0149) |
||||||||
| Firms with less than 500 employees in monotowns |
− 0.00934 (0.0238) |
||||||||
| Firms with 500–999 employees in monotowns |
− 0.08315 (0.1424) |
||||||||
| Firms with 1000–4999 employees in monotowns |
0.06665 (0.2033) |
||||||||
| Firms with 5000–9999 employees in monotowns |
0.19079 (0.3795) |
||||||||
| Firms with 10000 or more employees in monotowns |
0.30327 (0.4306) |
||||||||
| Location in a monotown × Federal state ownership |
0.14336 (0.1579) |
||||||||
| Location in a monotown × Regional state ownership |
0.07387 (0.0880) |
||||||||
| Open joint-stock company |
0.01414 (0.0842) |
− 0.02793 (0.1223) |
0.03573 (0.0508) |
0.12004*** (0.0347) |
0.11981*** (0.0347) |
0.11955*** (0.0347) |
0.13711*** (0.0368) |
0.10537*** (0.0376) |
0.10338** (0.0485) |
| Closed joint-stock company |
− 0.08510 (0.0754) |
− 0.02345 (0.1052) |
− 0.10848** (0.0450) |
0.03576 (0.0289) |
0.03589 (0.0289) |
0.03572 (0.0289) |
0.06086** (0.0293) |
0.09901*** (0.0307) |
0.09681** (0.0386) |
| Limited liability company |
− 0.08664 (0.0713) |
− 0.05720 (0.0982) |
− 0.08361** (0.0420) |
0.07239*** (0.0272) |
0.07234*** (0.0272) |
0.07230*** (0.0272) |
0.06986** (0.0277) |
0.08928*** (0.0290) |
0.11193*** (0.0364) |
| Large shareholding |
− 2.36003*** (0.2313) |
− 1.95319*** (0.2067) |
− 2.21074*** (0.1155) |
− 2.08191*** (0.0817) |
− 2.08271*** (0.0817) |
− 2.08229*** (0.0817) |
− 2.09494*** (0.0841) |
− 1.58868*** (0.1035) |
− 0.43140** (0.1927) |
| Foreign ownership |
0.22859* (0.1355) |
0.16989 (0.2166) |
0.08748 (0.0781) |
− 0.02657 (0.0538) |
− 0.02759 (0.0539) |
− 0.02666 (0.0538) |
− 0.06846 (0.0550) |
− 0.17001*** (0.0599) |
− 0.08844 (0.0729)s |
| Federal state ownership |
0.21899*** (0.0822) |
0.07990 (0.1048) |
0.19603*** (0.0487) |
0.23656*** (0.0374) |
0.23576*** (0.0374) |
0.22881*** (0.0383) |
0.21419*** (0.0379) |
0.19938*** (0.0393) |
0.17875*** (0.0492) |
| Regional state ownership |
0.08089 (0.0694) |
− 0.09043 (0.1033) |
0.04351 (0.0436) |
0.17951*** (0.0330) |
0.17930*** (0.0330) |
0.17178*** (0.0342) |
0.12288*** (0.0338) |
0.07056** (0.0352) |
0.01898 (0.0444) |
| Managerial discretion |
0.00510** (0.0024) |
− 0.00960** (0.0047) |
0.00229 (0.0015) |
0.00450*** (0.0012) |
0.00448*** (0.0012) |
0.00450*** (0.0012) |
− 0.00767*** (0.0017) |
− 0.01178*** (0.0015) |
− 0.00947*** (0.0018) |
| Board size |
− 0.07661*** (0.0178) |
− 0.05322** (0.0266) |
− 0.05781*** (0.0114) |
− 0.04850*** (0.0090) |
− 0.04835*** (0.0090) |
− 0.04829*** (0.0090) |
− 0.04467*** (0.0106) |
− 0.01940* (0.0100) |
− 0.00977 (0.0142) |
| Board size2 |
0.00396*** (0.0011) |
0.00347** (0.0016) |
0.00261*** (0.0007) |
0.00197*** (0.0006) |
0.00195*** (0.0006) |
0.00196*** (0.0006) |
0.00168** (0.0007) |
0.00072 (0.0007) |
− 0.00004 (0.0010) |
| International audit firm |
− 0.70038 (0.4562) |
− 0.47358 (0.3227) |
− 0.11070 (0.3225) |
0.16681 (0.2232) |
0.15818 (0.2239) |
0.16718 (0.2234) |
− 0.00922 (0.2773) |
− 0.09070 (0.2837) |
− 3.94919 (207.3188)s |
| Large Russian audit firm |
0.36394 (0.2410) |
− 0.29750 (0.4975) |
− 0.03428 (0.1462) |
0.01033 (0.1515) |
− 0.00438 (0.1554) |
0.01654 (0.1510) |
− 0.20844 (0.1936) |
− 0.27831 (0.1923) |
− 0.35263 (0.2715) |
| Local Russian audit firm |
0.01752 (0.0971) |
0.03091 (0.1924) |
0.11948* (0.0654) |
0.18613*** (0.0593) |
0.18537*** (0.0595) |
0.18676*** (0.0593) |
0.16031** (0.0699) |
0.06425 (0.0661) |
0.11157 (0.0858)s |
| ROA |
− 0.00706*** (0.0007) |
− 0.00793*** (0.0009) |
− 0.00639*** (0.0004) |
− 0.00709*** (0.0003) |
− 0.00709*** (0.0003) |
− 0.00708*** (0.0003) |
− 0.00695*** (0.0003) |
− 0.00669*** (0.0003) |
− 0.00583*** (0.0004) |
| Gross margin |
− 0.00295*** (0.0009) |
0.00061 (0.0011) |
− 0.00209*** (0.0005) |
− 0.00273*** (0.0004) |
− 0.00273*** (0.0004) |
− 0.00273*** (0.0004) |
− 0.00275*** (0.0004) |
− 0.00292*** (0.0004) |
− 0.00226*** (0.0005) |
| Listing on the stock market |
0.37294*** (0.1433) |
− 0.26262 (0.2284) |
0.06126 (0.0884) |
0.15429** (0.0736) |
0.15087** (0.0739) |
0.15356** (0.0736) |
0.17599** (0.0751) |
0.06228 (0.0802) |
− 0.07015 (0.1093) |
| Gearing |
0.00025*** (0.0001) |
0.00045*** (0.0001) |
0.00032*** (0.0000) |
0.00026*** (0.0000) |
0.00026*** (0.0000) |
0.00026*** (0.0000) |
0.00029*** (0.0000) |
0.00033*** (0.0000) |
0.00024*** (0.0000) |
| Firm size |
− 0.06726*** (0.0096) |
− 0.06753*** (0.0130) |
− 0.05371*** (0.0059) |
− 0.05850*** (0.0042) |
− 0.05839*** (0.0041) |
− 0.05830*** (0.0041) |
− 0.06434*** (0.0042) |
− 0.06981*** (0.0044) |
− 0.07469*** (0.0055) |
| Firm age |
− 0.37613*** (0.0182) |
− 0.38109*** (0.0248) |
− 0.35809*** (0.0112) |
− 0.40813*** (0.0082) |
− 0.40812*** (0.0082) |
− 0.40810*** (0.0082) |
− 0.38699*** (0.0084) |
− 0.35535*** (0.0088) |
− 0.29374*** (0.0109) |
| Business network |
− 0.00874 (0.0058) |
− 0.01629** (0.0081) |
− 0.01307*** (0.0036) |
− 0.01646*** (0.0026) |
− 0.01653*** (0.0026) |
− 0.01646*** (0.0026) |
− 0.01448*** (0.0026) |
− 0.01049*** (0.0026) |
− 0.00295 (0.0030) |
| Business diversification |
− 0.01199*** (0.0033) |
0.00001 (0.0044) |
− 0.00525*** (0.0020) |
0.00246* (0.0015) |
0.00246* (0.0015) |
0.00245* (0.0015) |
0.00232 (0.0015) |
0.00184 (0.0016) |
0.00309 (0.0019) |
| NACE division-level fixed effects | Yes | Yes | Yes | Yes | Yes | Yes | Yes | Yes | Yes |
This table contains estimation results of the first stage of a Heckman two-stage probit model with a sample selection of the determinants of distressed acquisition. The coefficient of the constant term is omitted from the table. The dependent variable is a dummy variable for failed firms. The estimation results of the second stage are reported in Tables 5, 6, 7, 8 and Appendix Table 14. Table 3 provides detailed definitions and descriptive statistics of the independent variables used in the estimation. Figures in parentheses are robust standard errors
***, **, and * denote statistical significance at the 1%, 5%, and 10% levels, respectively