ABSTRACT
This paper examines whether the economic crisis induced by the COVID-19 pandemic exhibits a Schumpeterian "cleansing” of less productive firms. Using firm-level data collected for 34 economies up to 18 months into the crisis, the study finds that less productive firms have a higher probability of permanently closing during the crisis, suggesting that the process of cleansing out unproductive activities is occurring. The paper also uncovers strong and negative relationships of firm exit with digital presence and with innovation. These relationships are driven by small firms. The study further finds that a burdensome business environment increases the probability of firm exit, also driven by small firms, and that a negative relationship exists between firm exit and age. Finally, evidence shows that the cleansing process is disrupted in countries which have introduced policies imposing a moratorium on insolvency procedures.Plain English SummaryThe purpose of this analysis is to investigate whether firms that are more productive are less likely to cease operation during the economic crisis induced by the COVID-19 pandemic. To verify this hypothesis, the paper uses data on firm characteristics, productivity, and status of operation from 34 countries. The data on firm characteristics and productivity were collected before the crisis, while data on the operating status were collected within 18 months since the appearance of the coronavirus. The results of the paper show that indeed, more productive firms are more likely to survive the crisis. In addition, businesses that have been in operation for longer, or ones which have a website or have introduced a new product in the years before the crisis are more likely to continue existing. The positive role of digitalization and innovation is true especially for small firms. Conversely, those businesses which have to spend more time in compliance with government regulations are less likely to survive. The policy implications show the importance of digitalization and innovation, the vulnerabilities of small firms, and the significance of good governance.
ABSTRACT
BACKGROUND: Regulation of sodium chloride transport in the aldosterone-sensitive distal nephron is essential for fluid homeostasis and BP control. The chloride-bicarbonate exchanger pendrin in ß-intercalated cells, along with sodium chloride cotransporter (NCC) in distal convoluted tubules, complementarily regulate sodium chloride handling, which is controlled by the renin-angiotensin-aldosterone system. METHODS: Using mice with mineralocorticoid receptor deletion in intercalated cells, we examined the mechanism and roles of pendrin upregulation via mineralocorticoid receptor in two different models of renin-angiotensin-aldosterone system activation. We also used aldosterone-treated NCC knockout mice to examine the role of pendrin regulation in salt-sensitive hypertension. RESULTS: Deletion of mineralocorticoid receptor in intercalated cells suppressed the increase in renal pendrin expression induced by either exogenous angiotensin II infusion or endogenous angiotensin II upregulation via salt restriction. When fed a low-salt diet, intercalated cell-specific mineralocorticoid receptor knockout mice with suppression of pendrin upregulation showed BP reduction that was attenuated by compensatory activation of NCC. In contrast, upregulation of pendrin induced by aldosterone excess combined with a high-salt diet was scarcely affected by deletion of mineralocorticoid receptor in intercalated cells, but depended instead on hypokalemic alkalosis through the activated mineralocorticoid receptor-epithelial sodium channel cascade in principal cells. In aldosterone-treated NCC knockout mice showing upregulation of pendrin, potassium supplementation corrected alkalosis and inhibited the pendrin upregulation, thereby lowering BP. CONCLUSIONS: In conjunction with NCC, the two pathways of pendrin upregulation, induced by angiotensin II through mineralocorticoid receptor activation in intercalated cells and by alkalosis through mineralocorticoid receptor activation in principal cells, play important roles in fluid homeostasis during salt depletion and salt-sensitive hypertension mediated by aldosterone excess.