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The Importance of Entry to Canadian Manufacturing with an Appendix on Measurement Issues

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  • Beckstead, Desmond
  • Baldwin, John R.
  • Girard, Andree

Abstract

Understanding the importance of the dynamic entry process in the Canadian economy involves measuring size of entry. The main purpose of this paper is to summarize the information we have on the amount of entry in Canada. The paper also fulfils another purpose. Some studies have focused on cross-country comparisons (Geroski and Schwalbach 1991; OECD 2001). Interpretation of the results of these studies is difficult unless methodological issues regarding how entry is measured are addressed. Without an understanding of the extent to which different databases produce different results, international comparisons are difficult to evaluate. Cross-country comparisons that are derived from extremely different data sources may be misleading because of the lack of comparability. Since there is more than one reliable database that can be used to estimate entry in Canada, this paper asks how measured entry rates vary across different Canadian databases. By examining the difference in entry rates produced by these databases, we provide an estimate of the range or confidence interval that should be used in evaluating whether there are real differences in measured entry rates across countries. We also offer guidance as to the questions that should be asked about the databases used by researchers who conduct international studies. Finally, we make suggestions as to areas of comparison on which international studies should focus.

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Bibliographic Info

Paper provided by Statistics Canada, Analytical Studies Branch in its series Analytical Studies Branch Research Paper Series with number 2002189e.

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Date of creation: 29 May 2002
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Handle: RePEc:stc:stcp3e:2002189e

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Web page: http://www.statcan.gc.ca
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Keywords: Business performance and ownership; Entry; exit; mergers and growth; Industries; Labour; Manufacturing;

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References

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  1. Lin, Zhengxi & Picot, Garnett & Yates, Janice, 1999. "The Entry and Exit Dynamics of Self-employment in Canada," Analytical Studies Branch Research Paper Series 1999134e, Statistics Canada, Analytical Studies Branch.
  2. Agarwal, Rajshree & Gort, Michael, 1996. "The Evolution of Markets and Entry, Exit and Survival of Firms," The Review of Economics and Statistics, MIT Press, vol. 78(3), pages 489-98, August.
  3. 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, December.
  4. Timothy Dunne & John Haltiwanger & John Baldwin, 1994. "A Comparison of Job Creation and Job Destruction in Canada and the United States," Working Papers 94-2, Center for Economic Studies, U.S. Census Bureau.
  5. Baldwin,John R. & Gorecki,Paul With contributions by-Name:Caves,Richard E., 1998. "The Dynamics of Industrial Competition," Cambridge Books, Cambridge University Press, number 9780521633574, April.
  6. Ariel Pakes & Richard Ericson, 1989. "Empirical Implications of Alternative Models of Firm Dynamics," NBER Working Papers 2893, National Bureau of Economic Research, Inc.
  7. Newman, Howard H, 1978. "Strategic Groups and the Structure-Performance Relationship," The Review of Economics and Statistics, MIT Press, vol. 60(3), pages 417-27, August.
  8. Baldwin, John R. & Bian, Lin & Dupuy, Richard & Gellatly, Guy, 2000. "Failure Rates for New Canadian Firms: New Perspectives on Entry and Exit," Failure Rates for New Canadian Firms: New Perspectives on Entry and Exit, Statistics Canada, Economic Analysis, number stcb5e, December.
  9. Baldwin, John R. & Rafiquzzaman, Mohammed, 1995. "Selection versus evolutionary adaptation: Learning and post-entry performance," International Journal of Industrial Organization, Elsevier, vol. 13(4), pages 501-522, December.
  10. John C. Haltiwanger, 1997. "Measuring and analyzing aggregate fluctuations: the importance of building from microeconomic evidence," Review, Federal Reserve Bank of St. Louis, issue May, pages 55-78.
  11. Bee Yan Aw & Xiaomin Chen & Mark J. Roberts, 1997. "Firm-level Evidence on Productivity Differentials, Turnover, and Exports in Taiwanese Manufacturing," NBER Working Papers 6235, National Bureau of Economic Research, Inc.
  12. Baldwin, John R., 1996. "Productivity Growth, Plant Turnover and Restructuring in the Canadian Manufacturing Sector," Analytical Studies Branch Research Paper Series 1995087e, Statistics Canada, Analytical Studies Branch.
  13. David B. Audretsch & A. Roy Thurik, 1999. "Innovation, Industry Evoluation and Employment," Tinbergen Institute Discussion Papers 99-068/3, Tinbergen Institute.
  14. Baldwin, John R. & Harchaoui, Tarek, 2002. "Productivity Growth in Canada," Productivity Growth in Canada, Statistics Canada, Economic Analysis, number stcb6e, December.
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Citations

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Cited by:
  1. Wulong Gu & Gary Sawchuk & Lori Rennison, 2003. "The effect of tariff reductions on firm size and firm turnover in canadian manufacturing," Review of World Economics (Weltwirtschaftliches Archiv), Springer, vol. 139(3), pages 440-459, September.
  2. Brown, W. Mark & Beckstead, Desmond & Baldwin, John R., 2003. "Hollowing-out, Trimming-down or Scaling-up? An Analysis of Head Offices in Canada, 1999 to 2002," Economic Analysis (EA) Research Paper Series 2003019e, Statistics Canada, Analytical Studies Branch.
  3. Martin-Barroso, David & Nuñez-Serrano, Juan Andres & Turrion, Jaime & Velazquez, Francisco J., 2011. "The European Map of Job Flows," MPRA Paper 33602, University Library of Munich, Germany, revised 2011.
  4. Maliranta, Mika, 2005. "Foreign-owned Firms and Productivity-enhancing Restructuring in Finnish Manufacturing Industries," Discussion Papers 965, The Research Institute of the Finnish Economy.
  5. Brons, Lajos, 2004. "On the Ontology of Events in Demographies of Organizations," MPRA Paper 1610, University Library of Munich, Germany, revised 2006.
  6. Baldwin, John R. & Gellatly, Guy, 2006. "Innovation Capabilities: The Knowledge Capital Behind the Survival and Growth of Firms," The Canadian Economy in Transition 2006013e, Statistics Canada, Economic Analysis.
  7. Mika Maliranta, 2005. "R&D, International Trade and Creative Destruction—Empirical Findings from Finnish Manufacturing Industries," Journal of Industry, Competition and Trade, Springer, vol. 5(1), pages 27-58, January.
  8. Baldwin, John R., 2005. "Death in the Industrial World: Plant Closures and Capital Retirement," Economic Analysis (EA) Research Paper Series 2005033e, Statistics Canada, Analytical Studies Branch.

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