Firm-Level Entry and Exit Dynamics over the Business Cycles

2017 ◽  
Author(s):  
Can Tian
Keyword(s):  
Business Cycles ◽  
Entry And Exit ◽  
Firm Level

scholarly journals Innovation, Reallocation, and Growth

2018 ◽  
Vol 108 (11) ◽  
pp. 3450-3491 ◽  
Author(s):  
Daron Acemoglu ◽  
Ufuk Akcigit ◽  
Harun Alp ◽  
Nicholas Bloom ◽  
William Kerr
Keyword(s):  
Productivity Growth ◽  
Endogenous Entry ◽  
Entry And Exit ◽  
Firm Level ◽  
High Type ◽  
Percent Improvement ◽  
Us Census ◽  
Innovative Capacity ◽  
Firm Entry And Exit ◽  
Central Economic

We build a model of firm-level innovation, productivity growth, and reallocation featuring endogenous entry and exit. A new and central economic force is the selection between high- and low-type firms, which differ in terms of their innovative capacity. We estimate the parameters of the model using US Census microdata on firm-level output, R&D, and patenting. The model provides a good fit to the dynamics of firm entry and exit, output, and R&D. Taxing the continued operation of incumbents can lead to sizable gains (of the order of 1.4 percent improvement in welfare) by encouraging exit of less productive firms and freeing up skilled labor to be used for R&D by high-type incumbents. Subsidies to the R&D of incumbents do not achieve this objective because they encourage the survival and expansion of low-type firms. (JEL D21, D24, H25, L52, O31, O34)

scholarly journals Entry and Exit of Nonprofit Organizations

2018 ◽  
Vol 9 (2) ◽  
Author(s):  
Gian Paolo Barbetta ◽  
Paolo Canino ◽  
Stefano Cima ◽  
Flavio Verrecchia
Keyword(s):  
Panel Data ◽  
Nonprofit Organizations ◽  
Census Data ◽  
Nonprofit Sector ◽  
Entry And Exit ◽  
Entry Rate ◽  
Firm Level ◽  
Significant Development ◽  
First Time ◽  
Very High

AbstractThe latest census of Italian nonprofit organizations – compared with the previous one – showed a significant development of the nonprofit sector between 2001 and 2011. The number of organizations increased more than 28 % while the growth of employees (about 61 %) was even more impressive.These results notwithstanding, the mere comparison of aggregate census data does not give a true understanding of the dynamic of the sector. The entry and exit of organizations, as well as their migration between different sectors of activity, or geographical areas, can be analyzed properly only using firm-level panel data, but these data are rarely available so that only a few authors had a chance to use them. In this paper, we try to fill this gap using firm-level panel data for the first time in Italy. Our analysis tempers the optimism arising from aggregate data. We show that: a) part of the growth is determined by the emergence of already active organizations that were not detected a decade ago; b) because of low barriers, the entry of new nonprofit organizations is very relevant, but their net contribution to the growth of employment is quite small; c) opposite to what happened in other countries, the exit of nonprofit organizations is very significant, and d) organizations that were already active a decade ago gave the most important contribution to the growth of employment. We also investigate geographical trends, showing that the slower growth of the nonprofit sector in Southern Italy depends on the very high exit rate of the area, while the entry rate is more or less in line with the rest of the country.

scholarly journals Local product space and firm-level churning in exported products

2019 ◽  
Vol 28 (6) ◽  
pp. 1473-1496
Author(s):  
Cilem Selin Hazir ◽  
Flora Bellone ◽  
Cyrielle Gaglio
Keyword(s):  
Product Space ◽  
Local Environment ◽  
Product Market ◽  
Manufacturing Firms ◽  
Entry And Exit ◽  
Micro Data ◽  
Firm Level ◽  
The Core ◽  
Local Product ◽  
Core Capabilities

Abstract This article explores the determinants of changes to the range of exports at the firm level with a focus on the role played by the firm’s local environment. It extends the model developed by Bernard et al. (2010) to a multiregional setting to account for localized externalities. The model is tested using French micro-data on monoregional manufacturing firms covering the period 2002–2007. Our main finding is that the local product space has an impact on exporters’ product-market entry and exit decisions. Firms tend to modify their exported product mix to achieve congruence with the core products of the locality. Also, firms receive higher revenue from the export of products that are more related to the core capabilities of the locality.

scholarly journals Formalization and productivity: firm-level evidence from Viet Nam

2020 ◽  
Author(s):  
Jann Lay ◽  
Tevin Tafese
Keyword(s):  
Productivity Growth ◽  
Manufacturing Sector ◽  
Viet Nam ◽  
Aggregate Productivity ◽  
Entry And Exit ◽  
Formal Sector ◽  
Policy Changes ◽  
Firm Level ◽  
Productivity Dynamics ◽  
Firm Entry And Exit

Using a firm-level panel dataset on private small- and medium-sized enterprises (SMEs) in Viet Nam’s manufacturing sector, this paper examines productivity dynamics of formal and informal firms. We decompose productivity changes into changes within and between formal and informal firms. We assess the contributions of firm entry and exit as well as informal–formal transitions. Our results show that productivity is considerably lower and misallocation more prevalent in the informal than in the formal sector. Yet, formalizing firms in Viet Nam make an important contribution to aggregate productivity growth among manufacturing SMEs, growing faster than other firms and increasing efficiency. We identify two ‘regimes’ of formalization. Until early 2010, more productive (previously) informal firms formalize. Policy changes and accelerated formalization then alter the characteristics of formalizers, as less productive firms become formal. While this formalization wave depresses average formal total factor productivity growth, the overall productivity effect is positive.

scholarly journals Product Creation and Destruction: Evidence and Price Implications

2010 ◽  
Vol 100 (3) ◽  
pp. 691-723 ◽  
Author(s):  
Christian Broda ◽  
David E Weinstein
Keyword(s):  
Business Cycles ◽  
Labor Markets ◽  
Price Index ◽  
Entry And Exit ◽  
Us Economy ◽  
Percentage Points ◽  
The Us ◽  
Large Sector ◽  
Product Creation ◽  
Cost Of Living Index

This paper describes the extent of product creation and destruction in a large sector of the US economy. We find four times more entry and exit in product markets than is found in labor markets because most product turnover happens within firms. Net product creation is strongly procyclical and primarily driven by creation rather than destruction. We find that a cost-of-living index that takes product turnover into account is 0.8 percentage points per year lower than a “fixed goods” price index like the CPI. The procyclicality of the bias implies that business cycles are more volatile than indicated by official statistics. (JEL E31, E32, L11, O31)

Jobs and Matches: Quits, Replacement Hiring, and Vacancy Chains and Vacancy Chains

2020 ◽  
Vol 2 (1) ◽  
pp. 101-124
Author(s):  
Yusuf Mercan ◽  
Benjamin Schoefer
Keyword(s):  
Business Cycles ◽  
Job Creation ◽  
Firm Level ◽  
Job Openings ◽  
Vacancy Chains

In the canonical DMP model of job openings, all job openings stem from new job creation. Jobs denote worker-firm matches, which are destroyed following worker quits. Yet, employers classify 56 percent of vacancies as quit-driven replacement hiring into old jobs, which evidently outlived their previous matches. Accordingly, aggregate and firm-level hiring tightly track quits. We augment the DMP model with longer-lived jobs arising from sunk job creation costs and replacement hiring. Quits trigger vacancies, which beget vacancies through replacement hiring. This vacancy chain can raise total job openings and net employment. The procyclicality of quits can thereby amplify business cycles. (JEL E24, E32, J23, J31, J63)

scholarly journals CAPITAL ACCUMULATION, VINTAGE AND PRODUCTIVITY: THE JAPANESE EXPERIENCE

2019 ◽  
Vol 64 (03) ◽  
pp. 747-771 ◽  
Author(s):  
TAIJI HAGIWARA ◽  
YOICHI MATSUBAYASHI
Keyword(s):  
Business Cycles ◽  
Capital Stock ◽  
Capital Accumulation ◽  
Firm Level ◽  
Economic Expansion ◽  
Capital Equipment ◽  
Productivity Effect ◽  
Japanese Experience ◽  
The Relationship

We empirically examine the relationship between capital accumulation, vintage and productivity of industries in Japan using firm-level microdata. Our analyses confirm that vintage significantly influenced productivity during the period of economic expansion. The effect was particularly notable during the upturn that started in 2000, when most examined industries displayed strong vintage effects. The rejuvenation of capital equipment during this period clearly resulted from a strong productivity effect. During the economic bubble of the late 1980s, by contrast, vintage exerted no observable effects on productivity despite significant increase in investment. This finding shows that an increase in capital stock during this period was not necessarily productive and likely produced a merely temporary boom. We reconfirm that the relation between vintage and productivity changed in subtle ways in response to the phases of business cycles.

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