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The Effect of New Business Formation on Regional Development over Time: The Case of Germany

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Author Info
Michael Fritsch
Pamela Mueller ()

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Abstract

We investigate the effects of new business formation on employment change in German regions. A special focus is on the lag-structure of this effect and on differences between regions. The different phases of the effects of new business formation on regional development are relatively pronounced in agglomerations as well as in regions with a high-level of labor productivity. In low-productivity regions, the overall employment effect of new business formation activity might be negative. The interregional differences indicate that regional factors play an important role.

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Paper provided by Max Planck Institute of Economics, Entrepreneurship, Growth and Public Policy Group in its series Papers on Entrepreneurship, Growth and Public Policy with number 2006-19.

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Length: 20 pages
Date of creation: Aug 2006
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Handle: RePEc:esi:egpdis:2006-19

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Related research
Keywords: Entrepreneurship; new business formation; regional development;

Other versions of this item:

Find related papers by JEL classification:
M13 - Business Administration and Business Economics; Marketing; Accounting - - Business Administration - - - New Firms; Startups
O1 - Economic Development, Technological Change, and Growth - - Economic Development
O18 - Economic Development, Technological Change, and Growth - - Economic Development - - - Regional, Urban, and Rural Analyses
R11 - Urban, Rural, and Regional Economics - - General Regional Economics - - - Analysis of Growth, Development, and Changes

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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.:
  1. André van Stel & David Storey & Pamela Mueller, 2006. "The effects of new firm formation on regional development over time: The case of Great Britain," Scales Research Reports H200618, EIM Business and Policy Research. [Downloadable!]
    Other versions:
  2. Fariñas, Jose C. & Ruano, Sonia, 2005. "Firm productivity, heterogeneity, sunk costs and market selection," International Journal of Industrial Organization, Elsevier, vol. 23(7-8), pages 505-534, September. [Downloadable!] (restricted)
  3. Udo Brixy & Michael Niese, 2003. "The determinants of regional differences in new firm formation in West-Germany," ERSA conference papers ersa03p268, European Regional Science Association. [Downloadable!]
  4. Michael Fritsch & Pamela Mueller, 2005. "The Persistence of Regional New Business Formation-Activity over Time – Assessing the Potential of Policy Promotion Programs," ERSA conference papers ersa05p706, European Regional Science Association. [Downloadable!]
    Other versions:
  5. David B. Audretsch & Max Keilbach, 2004. "Entrepreneurship Capital and Economic Performance," Papers on Entrepreneurship, Growth and Public Policy 2004-01, Max Planck Institute of Economics, Entrepreneurship, Growth and Public Policy Group. [Downloadable!]
    Other versions:
  6. Mueller, Pamela, 2006. "Exploring the knowledge filter: How entrepreneurship and university-industry relationships drive economic growth," Research Policy, Elsevier, vol. 35(10), pages 1499-1508, December. [Downloadable!] (restricted)
  7. Franz Kronthaler, 2005. "Economic capability of East German regions: results of a cluster analysis," Regional Studies, Taylor and Francis Journals, vol. 39(6), pages 739-750, August. [Downloadable!] (restricted)
  8. Michael Fritsch & Oliver Falck & Udo Brixy, 2004. "The Effect of Industry, Region and Time on New Business Survival - A Multi-Dimensional Analysis," Papers on Entrepreneurship, Growth and Public Policy 2004-31, Max Planck Institute of Economics, Entrepreneurship, Growth and Public Policy Group. [Downloadable!]
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  9. Eric J. Bartelsman & Mark Doms, 2000. "Understanding Productivity: Lessons from Longitudinal Microdata," Journal of Economic Literature, American Economic Association, vol. 38(3), pages 569-594, September. [Downloadable!] (restricted)
    Other versions:
  10. Michael Fritsch & Oliver Falck, 2003. "New Firm Formation by Industry over Space and Time: A Multi-Level Analysis," Discussion Papers of DIW Berlin 322, DIW Berlin, German Institute for Economic Research. [Downloadable!]
  11. Michael Fritsch, 2004. "Entrepreneurship, entry and performance of new business compared in two growth regimes: East and West Germany," Journal of Evolutionary Economics, Springer, vol. 14(5), pages 525-542, December. [Downloadable!] (restricted)
    Other versions:
  12. Michael Fritsch & Antje Weyh, 2006. "How Large are the Direct Employment Effects of New Businesses? An Empirical Investigation for West Germany," Small Business Economics, Springer, vol. 27(2), pages 245-260, October. [Downloadable!] (restricted)
  13. Adriaan J. van Stel & David J. Storey, 2004. "The link between firm births and job creation: Is there a Upas Tree effect?," Papers on Entrepreneurship, Growth and Public Policy 2004-33, Max Planck Institute of Economics, Entrepreneurship, Growth and Public Policy Group. [Downloadable!]
    Other versions:
  14. Eric A. Nerlinger & Franz-Josef Bade, 2000. "The spatial distribution of new technology-based firms: Empirical results for West-Germany," Papers in Regional Science, Springer, vol. 79(2), pages 155-176. [Downloadable!] (restricted)
  15. André van Stel & Kashifa Suddle, 2005. "The Impact of New Firm Formation on Regional Development in the Netherlands," Scales Research Reports H200503, EIM Business and Policy Research. [Downloadable!]
    Other versions:
  16. Boeri, Tito & Cramer, Ulrich, 1992. "Employment growth, incumbents and entrants : Evidence from Germany," International Journal of Industrial Organization, Elsevier, vol. 10(4), pages 545-565, December. [Downloadable!] (restricted)
  17. Michael Fritsch, 2008. "How does new business formation affect regional development? Introduction to the special issue," Small Business Economics, Springer, vol. 30(1), pages 1-14, January. [Downloadable!] (restricted)
  18. Michael Fritsch & Pamela Mueller, 2004. "The Effects of New Business Formation on Regional Development over Time," Papers on Entrepreneurship, Growth and Public Policy 2004-36, Max Planck Institute of Economics, Entrepreneurship, Growth and Public Policy Group. [Downloadable!]
  19. Michael Fritsch & Pamela Mueller, 2006. "The Effect of New Business Formation on Regional Development over Time: The Case of Germany," Papers on Entrepreneurship, Growth and Public Policy 2006-19, Max Planck Institute of Economics, Entrepreneurship, Growth and Public Policy Group. [Downloadable!]
    Other versions:
  20. Michael Fritsch & Pamela Mueller, 2004. "Effects of New Business Formation on Regional Development over Time," Regional Studies, Taylor and Francis Journals, vol. 38(8), pages 961-975, January. [Downloadable!] (restricted)
  21. David B. Audretsch & Michael Fritsch, 2002. "Growth Regimes over Time and Space," Regional Studies, Taylor and Francis Journals, vol. 36(2), pages 113-124, April. [Downloadable!] (restricted)
  22. Audretsch, D.B. & Fritsch, M., 1993. "A Note on the Measurement of Entry Rates," Papers 93-5, Bergakademie Freiberg Technical University - Faculty of Economics and Business Administration.
  23. Pamela Mueller, 2005. "Exploring the Knowledge Filter - How Entrepreneurship and University-Industry Relations Drive Economic Growth," ERSA conference papers ersa05p610, European Regional Science Association. [Downloadable!]
  24. Fritsch, Michael, 1997. " New Firms and Regional Employment Change," Small Business Economics, Springer, vol. 9(5), pages 437-48, October. [Downloadable!] (restricted)
Full references

Cited by:
(explanations, 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.)

  1. André Stel & Kashifa Suddle, 2008. "The impact of new firm formation on regional development in the Netherlands," Small Business Economics, Springer, vol. 30(1), pages 31-47, January. [Downloadable!] (restricted)
    Other versions:
  2. Congregado, Emilio & Golpe, Antonio A. & Parker, Simon C., 2009. "The Dynamics of Entrepreneurship: Hysteresis, Business Cycles and Government Policy," IZA Discussion Papers 4093, Institute for the Study of Labor (IZA). [Downloadable!]
  3. Nikolaj Malchow-Møller & Bertel Schjerning & Anders Sørensen, 2009. "Entrepreneurship, Job Creation, and Wage Growth," CAM Working Papers 2009-01, University of Copenhagen. Department of Economics. Centre for Applied Microeconometrics. [Downloadable!]
    Other versions:
  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. [Downloadable!] (restricted)
    Other versions:
  5. Marco Caliendo & Alexander S. Kritikos, 2008. "Start-Ups by the Unemployed: Characteristics, Survival and Direct Employment Effects," Working Papers 008, Hanseatic University, Germany, Department of Economics. [Downloadable!]
    Other versions:
  6. C. Praag & Peter Versloot, 2007. "What is the value of entrepreneurship? A review of recent research," Small Business Economics, Springer, vol. 29(4), pages 351-382, December. [Downloadable!] (restricted)
    Other versions:
  7. Michael Fritsch & Pamela Mueller, 2008. "The effect of new business formation on regional development over time: the case of Germany," Small Business Economics, Springer, vol. 30(1), pages 15-29, January. [Downloadable!] (restricted)
    Other versions:
  8. Michael Fritsch, 2008. "How does new business formation affect regional development? Introduction to the special issue," Small Business Economics, Springer, vol. 30(1), pages 1-14, January. [Downloadable!] (restricted)
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