Who will survive in Stockholm Archipelago? : A longitudinal analysis of firm-survival in a peripheral region

Abstract: This longitudinal study investigates firm-survival in a peripheral region. The analysis relies on a unique longitudinal dataset, encompassing all firms in 17 Stockholm Archipelago islands during 2000-2019, collected through data triangulation methods. The study employs multivariate analysis accomplished by three-level logistic regression models of repeated observations (level-1) of the same distinct firms (level-2) situated in specific islands (level-3). The main novel results suggest that firms on islands with higher population density have an increased probability of exit – specifically, that there exists an overcrowding of local markets and a harsher selection process in these islands. While time-distance to the mainland have been discussed as problematic, the effect on firm-survival is insignificant. However, local access to essential services and infrastructures significantly lowers the likelihood of firm-exit. Islands with increasing institutional thickness have increased community dynamics with more knowledge spillovers, community-level learning, and entrepreneurial ecosystems, leading to a higher likelihood of firm-survival. A higher ratio of summer visitors increases the probability of exit, suggesting that firms on islands with seasonal dependability may have difficulties surviving the off-season.