Firm Entry and Exit in Local Markets: 'Market Pull' or 'Unemployment Push' Effects, or Both?

Martin Carree and Marcus Dejardin ()
Additional contact information
Martin Carree: Maastricht University [Maastricht]

Post-Print from HAL

Abstract: Firm entry and exit flows in the retailing and consumer services may be viewed as market equilibrating processes. Local markets with considerable market room and high unemployment may be thought of having high subsequent entry rates and possibly low exit rates. We examine this relationship and obtain empirical results for a range of industries in 563 Belgian municipalities. We show that, over a three-year period, (net) entry is positively affected by the presence of local 'market room'. We find a significant 'unemployment push' effect on entry in some industries, but also a significantly positive effect of unemployment on exit. This pattern possibly indicates a 'revolving door regime' in areas marked by unemployment where new entrants leave the market relatively soon after entry, or only crowd out local competitors without creating additional employment.

Keywords: local development; unemployment; entrepreneurship; exit; entry (search for similar items in EconPapers)
Date: 2020
New Economics Papers: this item is included in nep-com, nep-cwa, nep-ent, nep-sbm and nep-ure
Note: View the original document on HAL open archive server: https://shs.hal.science/halshs-03220690
References: View references in EconPapers View complete reference list from CitEc
Citations:

Published in International Review of Entrepreneurship, 2020, 18 (3), pp.371-386

Downloads: (external link)
https://shs.hal.science/halshs-03220690/document (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:hal:journl:halshs-03220690

Access Statistics for this paper

More papers in Post-Print from HAL
Bibliographic data for series maintained by CCSD ().