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Start-Ups and Employment Growth - Evidence from Sweden

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  • Andersson, Martin

    ()
    (CESIS - Centre of Excellence for Science and Innovation Studies, Royal Institute of Technology)

  • Noseleit, Florian

    ()
    (Friedrich-Schiller-University Jena)

Abstract

We use longitudinal data over a decade on start-ups and employment in Swedish regions and analyze the effect of start-ups on subsequent employment growth. We extend previous analyses by examining the influence of regional start-ups in a sector on regional employment growth in the same sector and on other sectors. We find differences between different types of start-ups. Knowledge-intensive start-ups seem to have larger effects on the regional economy. In particular, start-ups in high-end services have significant negative impacts on employment in other sectors but a positive long-run impact. This is consistent with the idea that start-ups are a vehicle for changes in the composition of regional industry. Moreover, our results illustrate that the known S-shaped pattern can be attributed to different effects that start-ups in a sector have on employment change in the same sector and in others.

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Bibliographic Info

Paper 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 155.

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Length: 34 pages
Date of creation: 03 Dec 2008
Date of revision:
Handle: RePEc:hhs:cesisp:0155

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/
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Keywords: Entrepreneurship; Employment Growth; Regional; Development; Start-ups;

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References

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  1. Kristina Nyström, 2009. "Entry, market turbulence and industry employment growth," Empirica, Springer, vol. 36(3), pages 293-308, August.
  2. Josep Arauzo Carod & Daniel Liviano Solís & Mònica Martín Bofarull, 2008. "New business formation and employment growth: some evidence for the Spanish manufacturing industry," Small Business Economics, Springer, vol. 30(1), pages 73-84, January.
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  21. 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.
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  23. C. Mirjam van Praag & Peter H. Versloot, 2007. "What is the Value of Entrepreneurship? A Review of Recent Research," Tinbergen Institute Discussion Papers 07-066/3, Tinbergen Institute.
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Cited by:
  1. Saima Bashir & Tesfa Gebremedhin, 2011. "An Analysis of the Relationship Between New Firm Formation and Economic Development in the Northeast Region of the United States," Working Papers 201102, Regional Research Institute, West Virginia University.
  2. Michael Fritsch & Florian Noseleit, 2013. "Indirect employment effects of new business formation across regions: The role of local market conditions," Papers in Regional Science, Wiley Blackwell, vol. 92(2), pages 361-382, 06.
  3. Michael Fritsch & Florian Noseleit, 2013. "Start-ups, long- and short-term survivors, and their contribution to employment growth," Journal of Evolutionary Economics, Springer, vol. 23(4), pages 719-733, September.

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