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Impact of market entry and exit on EU productivity and growth performance

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  • Michele Cincera
  • Olivia Galgau

Abstract

The European Union and its Member States have been engaged in product market reforms over a long period with notable reforms including the Single Market Program and the Lisbon Agenda launched in March 2000. Product market reforms are seen as exerting both a direct and an indirect impact on productivity, however, the net effects of the direct effect were found to be small. This study concentrates on the impact of product market reforms on firm entry and exit that can itself be decomposed into two effects: internal restructuring which refers to productivity growth of individual firms present in the industry and external restructuring whereby the process of market selection leads to a reallocation of resources among individual firms. The change in firm entry and exit will in turn affect macroeconomic performance.

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Bibliographic Info

Paper provided by Directorate General Economic and Monetary Affairs (DG ECFIN), European Commission in its series European Economy - Economic Papers with number 222.

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Length: 122 pages
Date of creation: Feb 2005
Date of revision:
Handle: RePEc:euf:ecopap:0222

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Keywords: market entry; market exit; productivity; product market reform; performance growth; Cincera; Galgau;

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Citations

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Cited by:
  1. Werner Roeger & Janos Varga & Jan in 't Veld, 2008. "Structural Reforms in the EU: A simulation-based analysis using the QUEST model with endogenous growth," European Economy - Economic Papers 351, Directorate General Economic and Monetary Affairs (DG ECFIN), European Commission.
  2. Alexander W. Hoffmaister, 2006. "Barriers to Retail Competition and Prices," IMF Working Papers 06/231, International Monetary Fund.
  3. Laura Cavallo & Giuseppe Coco & Mario Martelli, 2009. "Evaluating administrative burdens through SCM: some indications from the Italian experience," series 0023, Dipartimento di Scienze Economiche e Metodi Matematici - Università di Bari, revised Apr 2009.
  4. Gaetan Nicodeme & Jacques-Bernard Sauner-Leroy, 2004. "Product market reforms and productivity: a review of the theoretical and empirical literature on the transmission channels," European Economy - Economic Papers 218, Directorate General Economic and Monetary Affairs (DG ECFIN), European Commission.
  5. Crafts, Nicholas, 2011. "British Relative Economic Decline Revisited," CAGE Online Working Paper Series 42, Competitive Advantage in the Global Economy (CAGE).
  6. Fabio Schiantarelli, 2005. "Product Market Regulation and Macroeconomic Performance: A Review of Cross Country Evidence," Boston College Working Papers in Economics 623, Boston College Department of Economics, revised 04 Aug 2008.
  7. Luis Orea, 2010. "The effect of legal barriers to entry in the Spanish retail market: a local market approach," Hacienda Pública Española, IEF, vol. 193(2), pages 49-74, June.
  8. Hans Pitlik & Margit Schratzenstaller, 2011. "Growth Implications of Structure and Size of Public Sectors," WIFO Working Papers 404, WIFO.
  9. Grant P. Kabango & Alberto Paloni, 2010. "Financial liberalisation and industrial development in Malawi," Working Papers 2010_08, Business School - Economics, University of Glasgow.
  10. Brendan Burchell & Alan Hughes, 2006. "The stigma of failure: An international comparison of failure tolerance and second chancing," ESRC Centre for Business Research - Working Papers wp334, ESRC Centre for Business Research.
  11. Crafts, Nicholas, 2012. "British relative economic decline revisited: The role of competition," Explorations in Economic History, Elsevier, vol. 49(1), pages 17-29.
  12. repec:cge:warwcg:42 is not listed on IDEAS
  13. Viktoria Kocsis & Ruslan Lukach & Bert Minne & Victoria Shestalova & Nick Zubanov & Henry van der Wiel, 2009. "Relation entry, exit and productivity: an overview of recent theoretical and empirical literature," CPB Document 180, CPB Netherlands Bureau for Economic Policy Analysis.
  14. Christian Dreger & Manuel Art�s & Rosina Moreno & Raúl Ramos & Jordi Suri�ach, 2007. "Study on the feasibility of a tool to measure the macroeconomic impact of structural reforms," European Economy - Economic Papers 272, Directorate General Economic and Monetary Affairs (DG ECFIN), European Commission.
  15. Ben Jelili, Riadh & Goaied, Mohamed, 2009. "Entry, Exit, and Productivity in Tunisian Manufacturing Industries," MPRA Paper 52222, University Library of Munich, Germany, revised 2008.
  16. Michele Cincera, 2005. "L'importance et l'étendue des barrières légales et administratives dans le cadre de la directive "Bolkenstein": une étude comparative entre la Belgique et ses principaux partenaires comm," DULBEA Working Papers 05-11.RR, ULB -- Universite Libre de Bruxelles.
  17. Valkonen, Laura, 2006. "Deregulation as a Means to Increase Competition and Productivity," Discussion Papers 1014, The Research Institute of the Finnish Economy.
  18. Lorenzo Codogno & Francesco Felici, . "Assessing Italy's Reform Challenges:What Do Growth Accounting and Structural Indicators Say?," Working Papers 8, Department of the Treasury, Ministry of the Economy and of Finance.
  19. Fabienne Ilzkovitz & Adriaan Dierx & Viktoria Kovacs & Nuno Sousa, 2007. "Steps towards a deeper economic integration: the internal market in the 21st century," European Economy - Economic Papers 271, Directorate General Economic and Monetary Affairs (DG ECFIN), European Commission.

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