The Widening Divide in Business Turnover between Large and Small Urban Areas

Jason Brown

Economic Review, 2018, issue Q III, 5-25

Abstract: Business turnover?the rate at which new firms enter and old firms exit the economy?has been declining for at least 40 years in the United States. Declining business turnover is potentially problematic, as it may signal a drop in innovation and productivity growth as well as a lower share of economic activity at new businesses. As a result, the economic fortunes of metropolitan areas are likely to be intertwined with the rate of business turnover they experience. {{p}} As the U.S. economy continues to transition from producing goods to providing services, changes in business turnover are unfolding differently in small versus large metropolitan areas. Jason P. Brown documents recent trends in business turnover across metropolitan areas of various sizes and shows that business turnover has declined much more sharply in small than in large urban areas. In addition, he finds that this gap widened in the years following the Great Recession. His results may help explain the widening economic divide between urban and rural areas of the country.

Keywords: Business turnover; Rural areas; Urban areas (search for similar items in EconPapers)
JEL-codes: R10 (search for similar items in EconPapers)
Date: 2018
References: Add references at CitEc
Citations: View citations in EconPapers (1)

Downloads: (external link)
https://www.kansascityfed.org/documents/666/2018-T ... %20Urban%20Areas.pdf (application/pdf)

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:fip:fedker:00067

Ordering information: This journal article can be ordered from

DOI: 10.18651/ER/3q18Brown

Access Statistics for this article

More articles in Economic Review from Federal Reserve Bank of Kansas City Contact information at EDIRC.
Bibliographic data for series maintained by Zach Kastens ().