The long-run evolution of business entry and exit rates in Canada

Li Li

Economic and Social Reports from Statistics Canada, Analytical Studies and Modelling Branch

Abstract: Since the 1980s, the entry and exit rates of firms have declined significantly worldwide, including in Canada and the United States, signalling a reduction in business dynamism. This paper builds on a study by MacDonald (2014) by extending the analysis of Canadian entry and exit trends from 1983 to 2012 up to 2021 and comparing these results with those from the United States. While Canadian entry and exit rates previously declined more sharply than those in the United States, this decline largely ceased in the late 2010s, with rates approaching levels similar to their U.S. counterparts. The Canadian declines are not attributable to sectoral shifts but rather affect all sectors. This paper further finds that sector-specific increases in industrial concentration do not appear to explain the decline in Canadian entry and exit rates.

Keywords: long-run evolution; business entry and exit; rates (search for similar items in EconPapers)
JEL-codes: J23 M21 (search for similar items in EconPapers)
Date: 2025-09-24
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Persistent link: https://EconPapers.repec.org/RePEc:stc:stcp8e:202500900001e

DOI: 10.25318/36280001202500900001-eng

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