Advanced Search
MyIDEAS: Login to save this article or follow this journal

Employee spinoffs and other entrants: Stylized facts from Brazil

Contents:

Author Info

  • Muendler, Marc-Andreas
  • Rauch, James E.
  • Tocoian, Oana

Abstract

We gauge the prevalence and performance of firms founded as employee spinoffs, relative to other new firms with and without parents, and relative to diversification ventures of existing firms entering new industries. Using a comprehensive linked employer–employee database from Brazil for the universe of formal firms during the period 1995–2001, we are able to identify an employee spinoff either when the director/manager moved from a parent in the same industry or when one-quarter of the employees shifted from a common parent. Depending on definition, employee spinoffs account for between one-sixth and one-third of the new firms in Brazil's private sector during this period. Regardless of definition, size at entry is larger for employee spinoffs than for new firms without parents but smaller than for diversification ventures of existing firms. Similarly, survival rates for employee spinoffs are higher than for new firms without parents and comparable to those for diversification ventures of existing firms. These results suggest that we can think of some part of a firm's productivity and riskiness as embodied in the firm's employees and portable.

Download Info

If you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
File URL: http://www.sciencedirect.com/science/article/pii/S0167718712000288
Download Restriction: Full text for ScienceDirect subscribers only

As the access to this document is restricted, you may want to look for a different version under "Related research" (further below) or search for a different version of it.

Bibliographic Info

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

Volume (Year): 30 (2012)
Issue (Month): 5 ()
Pages: 447-458

as in new window
Handle: RePEc:eee:indorg:v:30:y:2012:i:5:p:447-458

Contact details of provider:
Web page: http://www.elsevier.com/locate/inca/505551

Related research

Keywords: Employee spinoffs; Entrepreneurship; Firm performance; Labor turnover;

Other versions of this item:

Find related papers by JEL classification:

References

References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
as in new window
  1. Muendler, Marc-Andreas & Rauch, James E. & Tocoian, Oana, 2012. "Employee spinoffs and other entrants: Stylized facts from Brazil," International Journal of Industrial Organization, Elsevier, vol. 30(5), pages 447-458.
  2. Carol Corrado & Charles Hulten & Daniel Sichel, 2009. "Intangible Capital And U.S. Economic Growth," Review of Income and Wealth, International Association for Research in Income and Wealth, vol. 55(3), pages 661-685, 09.
  3. Cusatis, Patrick J. & Miles, James A. & Woolridge, J. Randall, 1993. "Restructuring through spinoffs*1: The stock market evidence," Journal of Financial Economics, Elsevier, vol. 33(3), pages 293-311, June.
  4. Klepper, Steven, 2001. "Employee Startups in High-Tech Industries," Industrial and Corporate Change, Oxford University Press, vol. 10(3), pages 639-74, September.
  5. HansK. Hvide, 2009. "The Quality of Entrepreneurs," Economic Journal, Royal Economic Society, vol. 119(539), pages 1010-1035, 07.
  6. Ellen R. McGrattan & Edward C. Prescott, 2009. "Unmeasured investment and the puzzling U.S. boom in the 1990s," Staff Report 369, Federal Reserve Bank of Minneapolis.
  7. Dunne, Timothy & Roberts, Mark J & Samuelson, Larry, 1989. "The Growth and Failure of U.S. Manufacturing Plants," The Quarterly Journal of Economics, MIT Press, vol. 104(4), pages 671-98, November.
  8. Naércio Aquino Menezes Filho & Marc-Andreas Muendler & Garey Ramey, 2006. "The Structure of Worker Compensation in Brazil, with a Comparison to France and the United States," CESifo Working Paper Series 1643, CESifo Group Munich.
  9. Bengt Holmstrom, 1982. "Moral Hazard in Teams," Bell Journal of Economics, The RAND Corporation, vol. 13(2), pages 324-340, Autumn.
  10. Anton, James J & Yao, Dennis A, 1995. "Start-ups, Spin-offs, and Internal Projects," Journal of Law, Economics and Organization, Oxford University Press, vol. 11(2), pages 362-78, October.
  11. repec:rje:randje:v:37:y:2006:i:4:p:841-860 is not listed on IDEAS
  12. Debarshi Nandy & Thomas Chemmanur, 2005. "How is Value Created in Spin-Offs? A Look Inside the Black Box," Working Papers 05-09, Center for Economic Studies, U.S. Census Bureau.
  13. Timothy Dunne & Mark J. Roberts & Larry Samuelson, 1988. "Patterns of Firm Entry and Exit in U.S. Manufacturing Industries," RAND Journal of Economics, The RAND Corporation, vol. 19(4), pages 495-515, Winter.
  14. Wiggins, Steven N, 1995. "Entrepreneurial Enterprises, Endogenous Ownership, and the Limits to Firm Size," Economic Inquiry, Western Economic Association International, vol. 33(1), pages 54-69, January.
  15. Teece, David J., 1986. "Profiting from technological innovation: Implications for integration, collaboration, licensing and public policy," Research Policy, Elsevier, vol. 15(6), pages 285-305, December.
  16. April Mitchell Franco & Darren Filson, 2000. "Knowledge diffusion through employee mobility," Staff Report 272, Federal Reserve Bank of Minneapolis.
  17. Abowd, J.M. & Kramarz, F. & Margolis, D.N. & Troske, K.R., 1998. "The Relative Importance of Employer and Employeee Effects on Compensation: a Comparison of France and the United States," Papiers du Laboratoire de Microéconomie Appliquée 1998-10, Université Panthéon-Sorbonne (Paris 1).
  18. Jovanovic, Boyan, 1982. "Selection and the Evolution of Industry," Econometrica, Econometric Society, vol. 50(3), pages 649-70, May.
  19. Alchian, Armen A & Demsetz, Harold, 1972. "Production , Information Costs, and Economic Organization," American Economic Review, American Economic Association, vol. 62(5), pages 777-95, December.
  20. Louis S. Jacobson & Robert J. LaLonde & Daniel G. Sullivan, 1992. "Earnings losses of displaced workers," Working Paper Series, Macroeconomic Issues 92-28, Federal Reserve Bank of Chicago.
  21. S. Klepper & S. Sleeper, 2002. "Entry by Spinoffs," Papers on Economics and Evolution 2002-07, Philipps University Marburg, Department of Geography.
  22. April Mitchell Franco & Darren Filson, 2006. "Spin‐outs: knowledge diffusion through employee mobility," RAND Journal of Economics, RAND Corporation, vol. 37(4), pages 841-860, December.
  23. Louis S. Jacobson & Robert J. LaLonde & Daniel G. Sullivan, 1993. "Long-term earnings losses of high-seniority displaced workers," Economic Perspectives, Federal Reserve Bank of Chicago, issue Nov, pages 2-20.
  24. Eriksson, Tor & Kuhn, Johan Moritz, 2004. "Firm Spin-offs in Denmark 1981-2000 - Patterns of Entry and Exit," Working Papers 04-6, University of Aarhus, Aarhus School of Business, Department of Economics.
  25. Zhu Wang & Luis Cabral, 2013. "Spin-offs: Theory and Evidence from the Early U.S. Automobile Industry," 2013 Meeting Papers 942, Society for Economic Dynamics.
  26. James E. Rauch & Joel Watson, 2010. "Client-Based Entrepreneurship," NBER Working Papers 15933, National Bureau of Economic Research, Inc.
  27. Hvide, Hans K., 2004. "Firm Size and the Quality of Entrepreneurs," Discussion Papers 2004/9, Department of Business and Management Science, Norwegian School of Economics.
  28. Krishnaswami, Sudha & Subramaniam, Venkat, 1999. "Information asymmetry, valuation, and the corporate spin-off decision," Journal of Financial Economics, Elsevier, vol. 53(1), pages 73-112, July.
  29. Benedetto, Gary & Haltiwanger, John & Lane, Julia & McKinney, Kevin, 2007. "Using Worker Flows to Measure Firm Dynamics," Journal of Business & Economic Statistics, American Statistical Association, vol. 25, pages 299-313, July.
  30. Cooper, Arnold C., 1985. "The role of incubator organizations in the founding of growth-oriented firms," Journal of Business Venturing, Elsevier, vol. 1(1), pages 75-86.
Full references (including those not matched with items on IDEAS)

Citations

Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
as in new window

Cited by:
  1. Fackler, Daniel & Schnabel, Claus, 2013. "Survival of Spinoffs and Other Startups: First Evidence for the Private Sector in Germany, 1976-2008," IZA Discussion Papers 7542, Institute for the Study of Labor (IZA).
  2. Andersson, Martin & Klepper, Steven, 2012. "Characteristics and Performance of New Firms and Spinoffs in Sweden," Working Paper Series 902, Research Institute of Industrial Economics.
  3. Douglas L. Campbell, 2010. "History, Culture, and Trade: A Dynamic Gravity Approach," EERI Research Paper Series EERI_RP_2010_26, Economics and Econometrics Research Institute (EERI), Brussels.
  4. Muendler, Marc-Andreas & Rauch, James E. & Tocoian, Oana, 2012. "Employee spinoffs and other entrants: Stylized facts from Brazil," International Journal of Industrial Organization, Elsevier, vol. 30(5), pages 447-458.
  5. Avsar, Veysel, 2013. "Antidumping, retaliation threats, and export prices," Policy Research Working Paper Series 6313, The World Bank.
  6. H. Fryges & M. Wright, 2013. "The origin of spin-offs – A typology of corporate and academic spin-offs," Working Papers of Faculty of Economics and Business Administration, Ghent University, Belgium 13/864, Ghent University, Faculty of Economics and Business Administration.
  7. Vivarelli, Marco, 2012. "Drivers of entrepreneurship and post-entry performance : microeconomic evidence from advanced and developing countries," Policy Research Working Paper Series 6245, The World Bank.
  8. Vivarelli, Marco, 2012. "Entrepreneurship in Advanced and Developing Countries: A Microeconomic Perspective," IZA Discussion Papers 6513, Institute for the Study of Labor (IZA).
  9. Fryges, Helmut & Müller, Bettina & Niefert, Michaela, 2013. "Job machine, think tank, or both: What makes corporate spinoffs different?," ZEW Discussion Papers 13-093, ZEW - Zentrum für Europäische Wirtschaftsforschung / Center for European Economic Research.
  10. James E. Rauch, 2013. "Employee Spinouts, Social Networks, and Family Firms," NBER Working Papers 19727, National Bureau of Economic Research, Inc.
  11. Marco Vivarelli, 2012. "Entrepreneurship and Post-Entry Performance: the Microeconomic Evidence," DISCE - Quaderni del Dipartimento di Scienze Economiche e Sociali dises1286, Università Cattolica del Sacro Cuore, Dipartimenti e Istituti di Scienze Economiche (DISCE).
  12. Veysel Avsar, 2010. "The Anatomy of Trade Deflection," Working Papers 1004, Florida International University, Department of Economics.

Lists

This item is not listed on Wikipedia, on a reading list or among the top items on IDEAS.

Statistics

Access and download statistics

Corrections

When requesting a correction, please mention this item's handle: RePEc:eee:indorg:v:30:y:2012:i:5:p:447-458. See general information about how to correct material in RePEc.

For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Zhang, Lei).

If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

If references are entirely missing, you can add them using this form.

If the full references list an item that is present in RePEc, but the system did not link to it, you can help with this form.

If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your profile, as there may be some citations waiting for confirmation.

Please note that corrections may take a couple of weeks to filter through the various RePEc services.