Firm size and business cycles

Túlio Cravo

IZA World of Labor, 2017, No 371, 371

Abstract: The discussion on how economic activity affects employment in large and small businesses is critical for the formulation of labor policies, especially during recessions. Knowing how firm size is related to job creation and job destruction is important to design effective policies aimed at dampening employment fluctuations. Recent evidence for developed countries indicates that large firms are proportionately more sensitive to cycles than small firms; however, this pattern is not confirmed for periods of credit constraint or in a developing country context, where small businesses might be more sensitive due to more extreme credit constraints.

Keywords: job flows; firm size; business cycles (search for similar items in EconPapers)
JEL-codes: E32 J21 J40 (search for similar items in EconPapers)
Date: 2017
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