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Entrepreneurship, job creation and wage growth

  • Nikolaj Malchow-Møller

    ()

  • Bertel Schjerning

    ()

  • Anders Sørensen

    ()

This paper analyses the importance of entrepreneurs for job creation and wage growth. Relying on unique data that covers all plants, firms and individuals in the Danish private sector, we are able to distil a number of different measures of entrepreneurial plants from the set of new plants, including measures that much more precisely capture the "truly new” or "entrepreneurial” plants than in previous studies. Using these data, we find that while new plants in general account for one third of the gross job creation in the economy, entrepreneurial plants are responsible for between 15% and 25% of this, and thus only account for up to 8% of total gross job creation in the economy. However, entrepreneurial plants seem to generate more additional jobs than other new plants in the years following entry. Finally, the jobs generated by entrepreneurial plants are to a large extent low-wage jobs, as they are not found to contribute to the growth in average wages. However, this insight varies across the different types of entrepreneurial plants.

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File URL: http://hdl.handle.net/10.1007/s11187-009-9173-y
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Article provided by Springer in its journal Small Business Economics.

Volume (Year): 36 (2011)
Issue (Month): 1 (January)
Pages: 15-32

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Handle: RePEc:kap:sbusec:v:36:y:2011:i:1:p:15-32
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  1. Bartelsman, Eric & Haltiwanger, John & Scarpetta1, Stefano, 2004. "Microeconomic evidence of creative destruction in industrial and developing countries," Policy Research Working Paper Series 3464, The World Bank.
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  15. repec:cup:cbooks:9780521828130 is not listed on IDEAS
  16. 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, June.
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