The Impact of International Competition On Small Businesses: SBA

A study was conducted by Impact of International Competition on Small-Firm Exit in U.S. Manufacturing in American University for SBA. The econometric study used the Statistics of US Businesses (SUSB) data to know the impact of the trade on small manufacturers. There will be an increase over the concern of impact on small US manufacturers because of increase in global trade and fluctuation in currency exchange rates. By the nature of their scale of operations, the small manufacturers are unable to insulate themselves from foreign competition when compared to the large manufacturers.

  • There was a higher rate of exit in consumer good industries among the small manufacturers.
    There is increased expectation by a strong dollar which leads to exit for small manufacturing firms with less than 20 employees in low-tech industries where import penetration is important.
    Firms will less than or about 9 employes experience an impact of exchange rate effects were high during the period of 1990s than in 2000s.