Firm Exit and Suspension in Developing Countries: Evidence from a Household Business Tax Census in Vietnam
Bibliographic record
Abstract
Abstract This paper studies the survival dynamics of household businesses in a developing country context using a high-frequency database of tax-registered firms in Vietnam. We document new stylized facts on firm turnover by distinguishing between permanent closures (exit) and temporary suspensions of operations—an important, yet often overlooked, margin of adjustment. While annual permanent closure rates for tax-registered household businesses are relatively low at 4–5 percent, temporary suspensions are far more prevalent: approximately a quarter of firms suspend operations each year, with an average duration exceeding 2.5 months. Suspension filings display strong seasonal patterns and serve as leading indicators of eventual exit. We exploit the COVID-19 pandemic as a quasi-natural experiment to show that household businesses suspend operations to cope with unanticipated shocks, and document sharp but short-lived increases in suspensions, particularly in services and occupations requiring high levels of face-to-face interaction. The findings highlight the importance of incorporating temporary suspensions into firm dynamics analyses and underscore the value of tax-based administrative data to study small business behavior in developing economies.
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How this classification was reachedexpand
Full frame machine prediction
Teacher imitationNot calibrated prevalence, not ground truth. Human validation pending. The Gemma side is a direct model label for every work in the frame, read from the title-only record. The Codex side is a classifier learned from the 10,348 direct Codex labels and calibrated to design-weighted sample rates; fields without enough sample support carry no Codex call. Candidate is the union of the two sides; consensus is their intersection. These outputs are machine_predicted_unvalidated and are not human labels.
Distilled classifier scores by category (both heads)
| Category | Codex | Gemma |
|---|---|---|
| Metaresearch | 0.001 | 0.003 |
| Meta-epidemiology (narrow) | 0.000 | 0.000 |
| Meta-epidemiology (broad) | 0.000 | 0.000 |
| Bibliometrics | 0.001 | 0.003 |
| Science and technology studies | 0.000 | 0.000 |
| Scholarly communication | 0.001 | 0.000 |
| Open science | 0.000 | 0.000 |
| Research integrity | 0.000 | 0.000 |
| Insufficient payload (model declined to judge) | 0.002 | 0.000 |
Machine scores (provisional)
The two teacher heads of the student model, read on this work. A score orders the frame for review; it never asserts a category, and the validation status ships verbatim with every row.
Baseline scores from an immature model (maturity gate not passed, 7 training rounds). Scores rank; they never assert a category.
score_only:v0-immature-baseline · verbatim from the scoring run: score_only means the number may rank works, and no category label ships from itClassification
machine, unvalidatedMachine predicted; a candidate call from one source (direct Gemma or distilled Codex), not a consensus.
How this classification was reached, model by model and score by score, is at the end of the page under "How this classification was reached".