Seminar

Hybrid seminar: Predicting Firm Exits with Machine Learning: Implications for Selection into COVID-19 Support and Productivity Growth

On Tuesday December 6th 2022, Benedikt Vogt (CPB) will give an online presentation titled: "Predicting Firm Exits with Machine Learning: Implications for Selection into COVID-19 Support and Productivity Growth" To attend this seminar, please send an e-mail to Simone Pailer (S.Pailer@cpb.nl). You will be registered at the reception or will receive a Webex-invitation via Outlook.

Date
December 6, 2022
Time
13:00 - 14:00
Location
Room 3 "Braamzaal" and online (Webex). To attend this seminar, please send an e-mail to Simone Pailer (S.Pailer@cpb.nl). You will be registered at the reception or will receive a Webex-invitation via Outlook
Presentation
Benedikt Vogt (CPB)
Working language
English

Evaluations of business support programs often face the problem of accurately predicting which firms leave the market. We address this problem, by first showing that a machine learning model better predicts firm exits than conventional methods. This improvement is mostly due to the use of high-dimensional firm data. Second, we provide new insights on the short-term selection effects into COVID-19 support in 2020 in the Netherlands. We find that firms with a lower predicted exit probability are more likely to use support. But because the benefits of support - as measured by prevented exits - are increasing in the probability to leave the market, we conclude that COVID-19 support also reduced the cleansing mechanism of economic crises but less than previously thought.

Contacts