WHAT MAKES FIRMS VULNERABLE TO RECESSIONARY PRESSURES

Recessions are a time when some (but certainly not all) firms are seve rely affected by a collapse in demand. Although one expects that less efficient firms will be the ones who are most severely affected, selec tion pressures can be myopic and penalize firms who are facing only tr ansitory difficulties. Using data generated by a large scale survey wh ich studied the effects of the recent recession on leading firms in th e UK, we provide some evidence which is not inconsistent with this vie w. In particular, our data suggest (inter alia) that firms who experie nced unusually high growth rates just prior to the recession often pro ved to be particularly vulnerable to recessionary pressures.