Lingering Illness or Sudden Death? Pre-Exit Employment Developments in German Establishments
AbstractUsing a large administrative dataset for Germany, this paper compares employment developments in exiting and surviving establishments. For both West and East Germany we find a clear "shadow of death" effect reflecting lingering illness: establishments shrink dramatically already several years before closure, employment growth rates differ strongly between exiting and surviving establishments, and this difference becomes stronger as exit approaches. We further show that prior to exit the workforce becomes on average more skilled, more female and older in exiting compared to surviving establishments. These effects are more clearly visible in West than in East Germany. Our results also hold when applying a matching approach.
Download InfoIf you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
Bibliographic InfoPaper provided by Institute for the Study of Labor (IZA) in its series IZA Discussion Papers with number 7081.
Length: 26 pages
Date of creation: Dec 2012
Date of revision:
Publication status: forthcoming in: Industrial and Corporate Change
Contact details of provider:
Postal: IZA, P.O. Box 7240, D-53072 Bonn, Germany
Phone: +49 228 3894 223
Fax: +49 228 3894 180
Web page: http://www.iza.org
Postal: IZA, Margard Ody, P.O. Box 7240, D-53072 Bonn, Germany
Other versions of this item:
- Daniel Fackler & Claus Schnabel & Joachim Wagner, 2012. "Lingering illness or sudden death? Pre-exit employment developments in German establishments," Working Paper Series in Economics 258, University of Lüneburg, Institute of Economics.
- Fackler, Daniel & Schnabel, Claus & Wagner, Joachim, 2012. "Lingering illness or sudden death? Pre-exit employment developments in German establishments," Discussion Papers 82, Friedrich-Alexander-University Erlangen-Nuremberg, Chair of Labour and Regional Economics.
- L2 - Industrial Organization - - Firm Objectives, Organization, and Behavior
- D22 - Microeconomics - - Production and Organizations - - - Firm Behavior: Empirical Analysis
- J65 - Labor and Demographic Economics - - Mobility, Unemployment, and Vacancies - - - Unemployment Insurance; Severance Pay; Plant Closings
This paper has been announced in the following NEP Reports:
- NEP-ALL-2013-01-07 (All new papers)
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.:
- Griliches, Zvi & Regev, Haim, 1995. "Firm productivity in Israeli industry 1979-1988," Journal of Econometrics, Elsevier, vol. 65(1), pages 175-203, January.
- repec:ner:sciepo:info:hdl:2441/7185 is not listed on IDEAS
- Carlos Carreira & Paulino Teixeira, 2011.
"The shadow of death: analysing the pre-exit productivity of Portuguese manufacturing firms,"
Small Business Economics,
Springer, vol. 36(3), pages 337-351, April.
- Carlos Carreira & Paulino Teixeira, 2009. "The Shadow of Death: Analysing the Pre-Exit Productivity of Portuguese Manufacturing Firms," GEMF Working Papers 2008-05, GEMF - Faculdade de Economia, Universidade de Coimbra.
- Guido Schwerdt, 2007.
"Labor Turnover before Plant Closure:'Leaving the sinking ship' vs. 'Captain throwing ballast overboard',"
Economics Working Papers
ECO2007/22, European University Institute.
- Schwerdt, Guido, 2011. "Labor turnover before plant closure: "Leaving the sinking ship" vs. "Captain throwing ballast overboard"," Labour Economics, Elsevier, vol. 18(1), pages 93-101, January.
- Guido Schwerdt, 2008. "Labor Turnover before Plant Closure: ‘Leaving the Sinking Ship’ vs. ‘Captain Throwing Ballast Overboard’," CESifo Working Paper Series 2252, CESifo Group Munich.
- Hethey, Tanja & Schmieder, Johannes F., 2010. "Using worker flows in the analysis of establishment turnover : evidence from German administrative data," FDZ Methodenreport 201006_en, Institut für Arbeitsmarkt- und Berufsforschung (IAB), Nürnberg [Institute for Employment Research, Nuremberg, Germany].
- Lionel Nesta & Flora Bellone & Patrick Musso & Michel Quéré, 2006.
"Productivity and Market Selection of French Manufacturing Firms in the Nineties,"
Sciences Po publications
2006-04, Sciences Po.
- Flora Bellone & Patrick Musso & Michel Quéré & Lionel Nesta, 2006. "Productivity and Market Selection of French Manufacturing Firms in the Nineties," Revue de l'OFCE, Presses de Sciences-Po, vol. 97(5), pages 319-349.
- Lionel Nesta & Flora Bellone & Patrick Musso & Michel Quéré, 2006. "Productivity and market selection of french manufacturing firms in the nineties," Sciences Po publications info:hdl:2441/7185, Sciences Po.
- Flora Bellone & Patrick Musso & Lionel Nesta & Michel Quéré, 2006. "Productivity and Market Selection of French Manufacturing Firms in the Nineties," Documents de Travail de l'OFCE 2006-04, Observatoire Francais des Conjonctures Economiques (OFCE).
- Boris Hirsch & Thorsten Schank & Claus Schnabel, 2010.
"Differences in Labor Supply to Monopsonistic Firms and the Gender Pay Gap: An Empirical Analysis Using Linked Employer-Employee Data from Germany,"
Journal of Labor Economics,
University of Chicago Press, vol. 28(2), pages 291-330, 04.
- Boris Hirsch & Thorsten Schank & Claus Schnabel, 2008. "Differences in Labor Supply to Monopsonistic Firms and the Gender Pay Gap: An Empirical Analysis Using Linked Employer-Employee Data from Germany," Working Papers 1111, Princeton University, Department of Economics, Industrial Relations Section..
- Lori G. Kletzer, 1998. "Job Displacement," Journal of Economic Perspectives, American Economic Association, vol. 12(1), pages 115-136, Winter.
- Marco Caliendo & Sabine Kopeinig, 2005.
"Some Practical Guidance for the Implementation of Propensity Score Matching,"
Discussion Papers of DIW Berlin
485, DIW Berlin, German Institute for Economic Research.
- Marco Caliendo & Sabine Kopeinig, 2008. "Some Practical Guidance For The Implementation Of Propensity Score Matching," Journal of Economic Surveys, Wiley Blackwell, vol. 22(1), pages 31-72, 02.
- Caliendo, Marco & Kopeinig, Sabine, 2005. "Some Practical Guidance for the Implementation of Propensity Score Matching," IZA Discussion Papers 1588, Institute for the Study of Labor (IZA).
- Flora Bellone & Patrick Musso & Lionel Nesta & Michel Qu�r�, 2008. "Market selection along the firm life cycle," Industrial and Corporate Change, Oxford University Press, vol. 17(4), pages 753-777, August.
- Paul A. Lengermann & Lars Vilhuber, 2002. "Abandoning the Sinking Ship: The Composition of Worker Flows Prior to Displacement," Longitudinal Employer-Household Dynamics Technical Papers 2002-11, Center for Economic Studies, U.S. Census Bureau.
- Anja Spengler, 2008. "European Data Watch: The Establishment History Panel," Schmollers Jahrbuch : Journal of Applied Social Science Studies / Zeitschrift für Wirtschafts- und Sozialwissenschaften, Duncker & Humblot, Berlin, vol. 128(3), pages 501-509.
- Davis, Steven J. & Haltiwanger, John, 1999. "Gross job flows," Handbook of Labor Economics, in: O. Ashenfelter & D. Card (ed.), Handbook of Labor Economics, edition 1, volume 3, chapter 41, pages 2711-2805 Elsevier.
- Richard Disney & Jonathan Haskel & Ylva Heden, 2003. "Entry, Exit and Establishment Survival in UK Manufacturing," Journal of Industrial Economics, Wiley Blackwell, vol. 51(1), pages 91-112, 03.
- Marcus Box, 2008. "The death of firms: exploring the effects of environment and birth cohort on firm survival in Sweden," Small Business Economics, Springer, vol. 31(4), pages 379-393, December.
- Andrew B Bernard & J. Bradford Jensen, 2007.
"Firm Structure, Multinationals, and Manufacturing Plant Deaths,"
The Review of Economics and Statistics,
MIT Press, vol. 89(2), pages 193-204, May.
- J. Bradford Jensen & Andrew Bernard, 2005. "Firm Structure, Multinationals, and Manufacturing Plant Deaths," Working Papers 05-18, Center for Economic Studies, U.S. Census Bureau.
- Andrew B. Bernard & J. Bradford Jensen, 2006. "Firm Structure, Multinationals, and Manufacturing Plant Deaths," Working Paper Series WP06-7, Peterson Institute for International Economics.
- Silviano Esteve-Pérez & Juan Mañez-Castillejo, 2008. "The Resource-Based Theory of the Firm and Firm Survival," Small Business Economics, Springer, vol. 30(3), pages 231-249, March.
- Troske, Kenneth R, 1996. "The Dynamic Adjustment Process of Firm Entry and Exit in Manufacturing and Finance, Insurance, and Real Estate," Journal of Law and Economics, University of Chicago Press, vol. 39(2), pages 705-35, October.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Mark Fallak).
If references are entirely missing, you can add them using this form.