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Job creation and persistence in services and manufacturing

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  • Catherine Armington
  • Zoltan Acs

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Abstract

An important new literature on gross employment flows has produced a great outpouring of stylized facts. In this paper we examine one aspect of this literature through the lens of dynamic models and theories of industrial evolution. We extend the Davis and Haltiwanger methodology for analysis of the persistence of gross job creation, distinguishing the persistence of new jobs from business births and from expansions. The persistence rates are then compared with those expected in each sector if average annual job creation and destruction were distributed across the business population independently of the prior year’s changes. The results provide a basis for discussing aspects of the different dynamics of job creation in services and manufacturing. Copyright Springer-Verlag Berlin/Heidelberg 2004

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Bibliographic Info

Article provided by Springer in its journal Journal of Evolutionary Economics.

Volume (Year): 14 (2004)
Issue (Month): 3 (07)
Pages: 309-325

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Handle: RePEc:spr:joevec:v:14:y:2004:i:3:p:309-325

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Related research

Keywords: Entrepreneurship; Industry evolution; Job flows; Services;

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References

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  1. Davis, Steven J. & Haltiwanger, John, 1999. "Gross job flows," Handbook of Labor Economics, in: O. Ashenfelter & D. Card (ed.), Handbook of Labor Economics, edition 1, volume 3, chapter 41, pages 2711-2805 Elsevier.
  2. Alfred R Nucci & Timothy Bates, 1990. "An Analysis of Small Business Size and Rate of Discontinuance," Working Papers 90-2, Center for Economic Studies, U.S. Census Bureau.
  3. Evans, David S., 1986. "Tests of Alternative Theories of Firm Growth," Working Papers 86-36, C.V. Starr Center for Applied Economics, New York University.
  4. Ericson, Richard & Pakes, Ariel, 1995. "Markov-Perfect Industry Dynamics: A Framework for Empirical Work," Review of Economic Studies, Wiley Blackwell, vol. 62(1), pages 53-82, January.
  5. Catherine Armington & Alicia Robb & Zoltan J Acs, 1999. "Measures Of Job Flow Dynamics In The U.S.," Working Papers 99-1, Center for Economic Studies, U.S. Census Bureau.
  6. Zoltan J Acs & Catherine Armington, 1998. "Longitudinal Establishment And Enterprise Microdata (LEEM) Documentation," Working Papers 98-9, Center for Economic Studies, U.S. Census Bureau.
  7. Steve J. Davis & John Haltiwanger, 1991. "Gross job creation, gross job destruction and employment reallocation," Working Paper Series, Macroeconomic Issues 91-5, Federal Reserve Bank of Chicago.
  8. Jovanovic, Boyan, 1982. "Selection and the Evolution of Industry," Econometrica, Econometric Society, vol. 50(3), pages 649-70, May.
  9. Audretsch, David B & Mahmood, Talat, 1994. "Firm Selection and Industry Evolution: The Post-entry Performance of New Firms," Journal of Evolutionary Economics, Springer, vol. 4(3), pages 243-60, September.
  10. Julia I. Lane & Alan G. Isaac & David W. Stevens, 1996. "Firm Heterogeneity and Worker Turnover," Labor and Demography 9602001, EconWPA.
  11. Steven J. Davis & John C. Haltiwanger & Scott Schuh, 1998. "Job Creation and Destruction," MIT Press Books, The MIT Press, edition 1, volume 1, number 0262540932, January.
  12. Robert E. Lucas Jr., 1978. "On the Size Distribution of Business Firms," Bell Journal of Economics, The RAND Corporation, vol. 9(2), pages 508-523, Autumn.
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Citations

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Cited by:
  1. Svein Olav Nås, 2007. "Industrial structure, business demography and innovation," Working Papers on Innovation Studies 20070611, Centre for Technology, Innovation and Culture, University of Oslo.
  2. Karl Wennberg, 2009. "Knowledge combinations and the survival of financial services ventures," Journal of Evolutionary Economics, Springer, vol. 19(2), pages 259-276, April.
  3. Marco Corsino & Roberto Gabriele & Sandro Trento, 2010. "Job flows in Italian SMEs: a longitudinal analysis of growth, size and age," DISA Working Papers 1008, Department of Computer and Management Sciences, University of Trento, Italy, revised 22 Dec 2010.
  4. Zoltan Acs & Pamela Mueller, 2008. "Employment effects of business dynamics: Mice, Gazelles and Elephants," Small Business Economics, Springer, vol. 30(1), pages 85-100, January.

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