| Summary: | This paper studies the survival of 187 foreign invested firms in Vietnam that were newly established in 2000 and measures for how many years they stay in the market over the 20002011 period. By using the Cox proportional hazard model, the empirical results show that foreign firms with growing current size are more likely to stay longer in the market. We also find that foreign firms entering the market with wholly-owned subsidiaries rather than doing joint ventures with local partners can live longer. However, locating in industrial zones or export processing zones does not help foreign firms to increase their survival probabilityin the market. By contrast to our prediction, agglomeration economies have no significant effect on firm survival. Further, cultural distance is found to have a quite strong impact on the survival of foreign firms. Proximities in culture make it easier for foreign firms in cooperating with local partners; therefore increasing their success in foreign markets.
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