Start-ups, New Business Employment, and the Effects on Incumbents: Who Contributes the Larger Share?

Michael Fritsch () and Florian Noseleit ()

No 2008-068, Jena Economics Research Papers from Friedrich-Schiller-University Jena

Abstract: We investigate the effects that new business formation has on employment in incumbent firms and compare it to the development in the start-ups. The analysis is performed for West German regions over the 1984-2002 period. It shows that the employment effects of new businesses on the incumbents are significantly positive. Moreover, we find indication that these effects on incumbents are considerably larger than the employment that is directly generated in the start-ups. We draw conclusions for policy and for further research.

Keywords: Entrepreneurship; new business formation; regional development; direct and indirect effects (search for similar items in EconPapers)
JEL-codes: L26 M13 O1 O18 R11 (search for similar items in EconPapers)
Date: 2008-09-10
New Economics Papers: this item is included in nep-bec, nep-ent and nep-geo
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Persistent link: https://EconPapers.repec.org/RePEc:jrp:jrpwrp:2008-068

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