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Firm size and short-term dynamics in aggregate entry and exit

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  • Manjón-Antolín, Miguel C.

Abstract

The interdependence between the sectorial rates of entry and exit is an established "stylised fact" in the research on industry dynamics. This paper argues that the size of firms and the reaction-adjustment period are important conditions that are missing from the empirical models typically used in this literature. I illustrate the effects of this omission on a panel of Spanish manufacturing industries. Estimates from error-component systems of equations provide evidence of a conical revolving door phenomenon and of dynamic partial adjustments in the replacement-displacement of firms.

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Bibliographic Info

Article provided by Elsevier in its journal International Journal of Industrial Organization.

Volume (Year): 28 (2010)
Issue (Month): 5 (September)
Pages: 464-476

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Handle: RePEc:eee:indorg:v:28:y:2010:i:5:p:464-476

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Web page: http://www.elsevier.com/locate/inca/505551

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Keywords: Industry dynamics Symmetry Simultaneity;

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References

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Citations

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Cited by:
  1. James E. Prieger, 2005. "The Impact of Cost Changes on Industry Dynamics," Working Papers 51, University of California, Davis, Department of Economics.
  2. Andersson, Martin & Braunerhjelm, Pontus & Thulin, Per, 2011. "Creative Destruction and Productivity – Entrepreneurship by type, sector and sequence," Working Papers 2011:8, Swedish Entrepreneurship Forum.
  3. Ricjard Kneller & Danny McGowan, . "Tax Policy and Firm Entry and Exit Dynamics: Evidence from OECD Countries," Discussion Papers 12/01, University of Nottingham, School of Economics.
  4. J. Arauzo & M. Manjón & M. Martín & A. Segarra, 2007. "Regional and Sector-specific Determinants of Industry Dynamics and the Displacement–replacement Effects," Empirica, Springer, vol. 34(2), pages 89-115, April.
  5. Richard Kneller & Danny McGowan, . "Entrepreneurship Dynamics, Market Size and Fiscal Policy," Discussion Papers 11/07, University of Nottingham, School of Economics.
  6. Kostas Tsekouras & Efthalia Dimara & Dimitris Skuras & Dimitris Tzelepis, 2009. "Back to basics: The Comanor–Wilson MES index revisited," Small Business Economics, Springer, vol. 32(1), pages 111-120, January.

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