of survival of all MNC's in the Irish manufacturing sector, in the 1980-
1996 period.21
(Figure 1)
The survival function, based on 1,515 MNC's between 1980 and 1996,
summarises the survival experiences of foreign-owned plants for each of
the four OECD subsectors. This analysis is not based on the total time that
the plants existed in Ireland, but rather only on the time that they remained
operational during 1980-1996. Our analysis takes account of any plant
which at one point reported employing ten persons or more during this
period. A plant can have remained operational (survived) for a maximum
of seventeen years (1980-1996) or a minimum of one year.
We note the growing gap between sectors the longer the time period
we consider. The probability of a plant remaining in operation in Ireland
for the full seventeen years is positively related to the level of
technological sophistication of the sector in which it operates. From the
data underlying Figure 1, we can derive Table A1 (in the appendix) which
shows the estimated probabilities that a plant in a given sector will survive
5, 10 or 17 years over the period 1980-1996. The longer the time period
considered ex ante, the lower the probability of the plant remaining
operational (surviving) in Ireland for one additional year (Audretsch
1991,1995; Kearns and Ruane, 1998). The probability of all foreign-
owned plants surviving 17 years in the Irish manufacturing sector is
approximately 47 per cent, compared with 55 and 70 per cent probability
respectively for five and ten years between 1980 and 1996.
21 These probabilities have been estimated using lifetable analysis. Lifetable analysis is a technique
which permits the estimation of the probability of an event (exit) occurring at different time (years)
points. It allows for the fact that not all plants will have exited during the period of observation.
Lifetable analysis allows a cohort to be distinguished by one characteristic only and the differing
probabilities to be estimated for each group.
17