Determinants of Regional Entry and Exit in Industrial Sectors
AbstractRecent empirical research by, for example, Audretsch and Fritsch (1999) and Armington and Acs, (2002) shows that regional determinants of new firm formation differs between industries. It has also been suggested that a large part of the regional variation of new firm formation can be explained by differences in industrial structure. This paper reinvestigates the regional determinants of entry and exit considering these findings. The empirical analysis is performed using data on Swedish firm entry and exit rates for 1997-2001. It is shown that on average about 0.5 to 2.7 percent of the regional variation in entry and exit rates remains to be explained, after controlling for differences in industrial structure, but that there is substantial regional variation. A majority of the firms in the 47 industries investigated are sensitive to unobserved regional characteristics, such as regional policy when deciding to enter or exit a particular region. Agglomeration and the size structure in the particular industry and region are factors that are found to influence entry and exit rates in almost all industries.
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Bibliographic InfoPaper provided by Royal Institute of Technology, CESIS - Centre of Excellence for Science and Innovation Studies in its series Working Paper Series in Economics and Institutions of Innovation with number 33.
Length: 44 pages
Date of creation: 12 Aug 2005
Date of revision:
Contact details of provider:
Postal: CESIS - Centre of Excellence for Science and Innovation Studies, Royal Institute of Technology, SE-100 44 Stockholm, Sweden
Phone: +46 8 790 95 63
Web page: http://www.infra.kth.se/cesis/
More information through EDIRC
Entry; exit; industry structure; regions;
Find related papers by JEL classification:
- L10 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - General
- R12 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General Regional Economics - - - Size and Spatial Distributions of Regional Economic Activity; Interregional Trade (economic geography)
This paper has been announced in the following NEP Reports:
- NEP-ALL-2005-09-11 (All new papers)
- NEP-COM-2005-09-11 (Industrial Competition)
- NEP-ENT-2005-09-11 (Entrepreneurship)
- NEP-GEO-2005-09-11 (Economic Geography)
- NEP-IND-2005-09-11 (Industrial Organization)
- NEP-TID-2005-09-11 (Technology & Industrial Dynamics)
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.:
- Peter Johnson & Simon Parker, 1996. "Spatial Variations in the Determinants and Effects of Firm Births and Deaths," Regional Studies, Taylor & Francis Journals, vol. 30(7), pages 679-688.
- David Audretsch & Michael Fritsch, 1999. "The Industry Component of Regional New Firm Formation Processes," Review of Industrial Organization, Springer, vol. 15(3), pages 239-252, November.
- Catherine Armington & Zoltan Acs, 2002. "The Determinants of Regional Variation in New Firm Formation," Regional Studies, Taylor & Francis Journals, vol. 36(1), pages 33-45.
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- Paul Krugman, 1998. "Space: The Final Frontier," Journal of Economic Perspectives, American Economic Association, vol. 12(2), pages 161-174, Spring.
- Wang, Daili, 2013.
[Foreign Direct Investment and the Entry of New Firms]," MPRA Paper 50984, University Library of Munich, Germany.
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