The Nature of Firm Growth

Petr Sedlacek, Benjamin Pugsley and Vincent Sterk
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Vincent Sterk: University College London

No 196, 2017 Meeting Papers from Society for Economic Dynamics

Abstract: There are vast differences in the growth patterns of firms: high-growth, young businesses, or “gazelles”, account for the vast majority of employment growth at incumbent firms. Using a large administrative panel data set for the United States, we provide evidence that ex-ante differences in the growth potential of firms account for most of the size heterogeneity across firms of a given age. First, we estimate a reduced-form employment process, allowing for heterogeneity in steady-state levels and deriving parameter identification from the autocovariance function of employment. Next, we estimate a general equilibrium firm dynamics model and explore the implications for firm selection and the macro effects of firm-level distortions.

Date: 2017
New Economics Papers: this item is included in nep-bec, nep-dge, nep-ent, nep-sbm and nep-tid
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Citations: View citations in EconPapers (9)

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Related works:
Journal Article: The Nature of Firm Growth (2021)
Working Paper: The Nature of Firm Growth (2018)
Working Paper: The Nature of Firm Growth (2018)
Working Paper: The Nature of Firm Growth (2017)
Working Paper: The nature of firm growth (2017)
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Persistent link: https://EconPapers.repec.org/RePEc:red:sed017:196

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