The Role of Start-Ups in StructuralTransformation

Robert C. Dent, Fatih Karahan, Benjamin Pugsley and Aysegul Sahin

Working Papers from U.S. Census Bureau, Center for Economic Studies

Abstract: The U.S. economy has been going through a striking structural transformation—the secular reallocation of employment across sectors—over the past several decades. We propose a decomposition framework to assess the contributions of various margins of firm dynamics to this shift. Using firm-level data, we find that at least 50 percent of the adjustment has been taking place along the entry margin, owing to sectors receiving shares of start-up employment that differ from their overall employment shares. The rest is mostly the result of life cycle differences across sectors. Declining overall entry has a small but growing effect of dampening structural transformation.

Keywords: structural transformation; employment dynamics; sectoral reallocation (search for similar items in EconPapers)
Pages: 14 pages
Date: 2016-01
New Economics Papers: this item is included in nep-bec, nep-ent, nep-sbm and nep-tid
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https://www2.census.gov/ces/wp/2016/CES-WP-16-38.pdf First version, 2016 (application/pdf)

Related works:
Journal Article: The Role of Startups in Structural Transformation (2016)
Working Paper: The role of start-ups in structural transformation (2016)
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Persistent link: https://EconPapers.repec.org/RePEc:cen:wpaper:16-38

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