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Determinants of plant closures in Swedish manufacturing

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  • Andersson, Fredrik

    ()
    (IFAU - Office of Labour Market Policy Evaluation)

  • Vejsiu, Altin

    (IFAU - Office of Labour Market Policy Evaluation)

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    Abstract

    We study the derminants of plant closures i Swedish manufacturing using linked employer-employee data. From our theoretical framework we derive and empirically test hypothesis regarding the linkages between the probability of plant failure and: 1) industry-specific characteristics of production and product demand; 2) local labor market conditions; and 3) plant-specific sources of heterogeneity, including the importance of insider mechanisms in wage determination, plant specific human capital, selection mechanisms and technology vintage effects. Our results suggest that all these factors matter in ways that by and large conform to the a priori hypotheses.

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    Bibliographic Info

    Paper provided by IFAU - Institute for Evaluation of Labour Market and Education Policy in its series Working Paper Series with number 2001:6.

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    Length: 41 pages
    Date of creation: 15 Jun 2001
    Date of revision:
    Handle: RePEc:hhs:ifauwp:2001_006

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    Postal: IFAU, P O Box 513, SE-751 20 Uppsala, Sweden
    Phone: (+46) 18 - 471 70 70
    Fax: (+46) 18 - 471 70 71
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    Web page: http://www.ifau.se/
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    Related research

    Keywords: Plant closures; job reallocation; insider wage determination; selection mechanisms; capital vintage effects; linked employer-employee data;

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    References

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    1. Mata, Jose & Portugal, Pedro, 1994. "Life Duration of New Firms," Journal of Industrial Economics, Wiley Blackwell, vol. 42(3), pages 227-45, September.
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    7. Salvanes, K.G. & Tveteras, R., 1999. "Firm Exit, Vintage Effect and the Business Cycle in Norway," Papers 2/99, Norwegian School of Economics and Business Administration-.
    8. Russell Cooper & John Haltiwanger & Laura Power, 1995. "Machine Replacement and the Business Cycle: Lumps and Bumps," Papers 0062, Boston University - Industry Studies Programme.
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    12. Dale T. Mortensen & Christopher A. Pissarides, 1998. "Technological Progress, Job Creation and Job Destruction," Review of Economic Dynamics, Elsevier for the Society for Economic Dynamics, vol. 1(4), pages 733-753, October.
    13. Jesper Antelius & Lars Lundberg, 2003. "Competition, Market Structure and Job Turnover," Journal of Industry, Competition and Trade, Springer, vol. 3(3), pages 211-226, September.
    14. 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.
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    17. repec:att:wimass:8904 is not listed on IDEAS
    18. Boeri, Tito & Bellmann, Lutz, 1995. "Post-entry behaviour and the cycle: Evidence from Germany," International Journal of Industrial Organization, Elsevier, vol. 13(4), pages 483-500, December.
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    Cited by:
    1. Eliason, Marcus & Storrie, Donald, 2004. "The Echo of Job Displacement," Working Papers in Economics 135, University of Gothenburg, Department of Economics.
    2. Forslund, Anders & Lindh, Thomas, 2004. "Decentralisation of bargaining and manufacturing employment: Sweden 1970-96," Working Paper Series 2004:3, IFAU - Institute for Evaluation of Labour Market and Education Policy.
    3. Larsson, Laura, 2002. "Sick of Being Unemployed? Interactions Between Unemployment and Sickness Insurance in Sweden," Working Paper Series 2002:5, Uppsala University, Department of Economics.
    4. Larsson, Laura, 2002. "Sick of being unemployed? Interactions between unemployment and sickness insurance in Sweden," Working Paper Series 2002:6, IFAU - Institute for Evaluation of Labour Market and Education Policy.

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