The paper examines entry, exit and the survival of firms in terms of evolutionary changes in the marker from the first introduction of a product to maturity of the market. It is shown that both entry and exit rates depend systematically on the stage of development of the market in the cycle from birth to maturity. Survival rates depend both on stage of development and on individual firm attributes. The empirical work is carried out with data for 25 new products. A complete inventory of entering, exiting and surviving firms from the birth of a new product to its maturity was developed.

On average, roughly 5-10 percent of the firms in a given market leave that market over the span of a single year. At least so data for a broad range of industries in several economies tell us. What is it, other than random shocks, that determines the probability of survival for a firm in a given market? We start by decomposing the forces that affect survival into industry and firm attributes. Industry attributes, we hypothesize, encompass variables that exert their influence both over time and across markets. The variables that operate over time are defined by the life cycle of the industry. Life cycles of the industry affect mainly the characteristics of demand and the rate and form of technical change. Variations across firms, we hypothesize, arise mainly from learning-by-doing, Darwinian survival of the fittest, and the obsolescence of initial endowments. These variables are linked to the life cycle of the firm. How these industry and firm life cycles define patterns of survival is the story

Efficiency in the Use of Technology in Economic Education: Some Preliminary Results by Kim Sosin, Betty J. Lecha, Rajshree Agarwal, Robin L. Bartlett and Joseph I. Daniel. Published in volume 94, issue 2, pages 253-258 of American Economic Review, May 2004