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Job Creation and the Intra-distribution Dynamics of the Firm Size Distribution

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Author Info

  • Huber, Peter

    ()
    (Austrian Institute of Economic Research)

  • Oberhofer, Harald

    ()
    (University of Salzburg)

  • Pfaffermayr, Michael

    ()
    (University of Innsbruck)

Abstract

Based on a three equations model for initial firm size, survival and firm growth we estimate firm-specific transition probabilities between size classes of the firm size distribution. This allows to analyze counterfactual scenarios that assess the impact of changes in exogenous variables on the intra-distribution dynamics of the firm size distribution. We find that a counterfactual decrease in average firm age increases the exit hazard of young firms, and at the same time reduces the probability to observe high growth firms. An increase in the industry-wide entry rate and an increase in market growth, by contrast, havw virtually no impact on the intra-distribution dynamics of the firm size distribution. Finally, a larger birth size increases the probability for the youngest and smallest firms to be fast growing ones.

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Bibliographic Info

Paper provided by University of Salzburg in its series Working Papers in Economics and Finance with number 2012-5.

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Length: 37 pages
Date of creation: 27 Apr 2012
Date of revision:
Handle: RePEc:ris:sbgwpe:2012_005

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Keywords: Firm growth; survival; entry size; high growth firms; counterfactual scenario analysis; sample selection;

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References

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Cited by:
  1. Peter Huber & Harald Oberhofer & Michael Pfaffermayr, 2012. "Who Creates Jobs? Estimating Job Creation Rates at the Firm Level," WIFO Working Papers 435, WIFO.
  2. Peter Huber & Harald Oberhofer & Michael Pfaffermayr, 2014. "Job creation and the intra-distribution dynamics of the firm size distribution," Industrial and Corporate Change, Oxford University Press, vol. 23(1), pages 171-197, February.

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