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Firm Growth, European Industry Dynamics and Domestic Business Cycles

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  • Harald Oberhofer

    (University of Salzburg)

Abstract

Based on the empirical firm growth literature and on heterogeneous (microeconomic) adjustment models, this paper empirically investigates the impact of European industry fluctuations and domestic business cycles on the growth performance of European firms. Since the implementation of the Single Market program the EU 27 member countries share a common market. Accordingly, the European industry business cycle is expected to become a more influential predictor of European firms' behaviour at the expense of domestic fluctuations. Empirically, the results of a two-part model for a sample of European manufacturing firms reject this hypothesis. Additionally, subsidiaries of multinational enterprises constitute the most stable firm cohort throughout the observed business cycle.

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Bibliographic Info

Paper provided by WIFO in its series WIFO Working Papers with number 377.

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Length: 30 pages
Date of creation: 19 Jul 2010
Date of revision:
Handle: RePEc:wfo:wpaper:y:2010:i:377

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Keywords: Firm growth; industry dynamics; domestic business cycle; European integration; multinational enterprises; two-part model;

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Citations

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Cited by:
  1. Huber, Peter & Oberhofer, Harald & Pfaffermayr, Michael, 2012. "Job Creation and the Intra-distribution Dynamics of the Firm Size Distribution," Working Papers in Economics and Finance 2012-5, University of Salzburg.
  2. Harald Oberhofer, 2010. "Firm growth, European industry dynamics and domestic business cycles," FIW Working Paper series 055, FIW.
  3. Crespo Cuaresma, Jesus & Oberhofer, Harald & Vincelette, Gallina A., 2014. "Institutional Barriers and Job Creation in Central and Eastern Europe," Working Papers in Economics and Finance 2014-1, University of Salzburg.
  4. Oberhofer, Harald, 2010. "Employment effects of acquisitions: Evidence from acquired European firms," Working Papers in Economics and Finance 2010-10, University of Salzburg.
  5. Werner Hölzl, 2011. "Persistence, Survival and Growth: A Closer Look at 20 Years of High-Growth Firms in Austria," WIFO Working Papers 403, WIFO.

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