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Firm Size Distribution and Employment Fluctuations : Theory and Evidence

Görg, Holger ; Henze, Philipp ; Jienwatcharamongkhol, Viroj LU ; Kopasker, Daniel ; Molana, Hassan ; Montagna, Catia and Sjöholm, Fredrik LU (2017) In Research in Economics 71(4). p.690-703
Abstract
We show that the firm-size distribution is an important determinant of the relationship between an industry's employment and output. A theoretical model predicts that changes in demand for an industry's output have larger effects on employment, resulting from adjustments at both the intensive and extensive margin, in industries characterised by a distribution that has a lower density of large firms. Industry-specific shape parameters of the firm size distributions are estimated using firm-level data from Germany, Sweden and the UK, and used to augment a relationship between industry-level employment and output. The empirical results align with the predictions of the theory.
Please use this url to cite or link to this publication:
author
; ; ; ; ; and
organization
publishing date
type
Contribution to journal
publication status
published
subject
keywords
firm distribution, firm size, employment, fluctuations
in
Research in Economics
volume
71
issue
4
pages
690 - 703
publisher
Academic Press
external identifiers
  • scopus:85029768117
ISSN
1090-9443
DOI
10.1016/j.rie.2017.09.002
language
English
LU publication?
yes
id
5a9c6f7a-d682-485f-a576-8a7b2af9de44
date added to LUP
2017-10-06 15:45:30
date last changed
2022-03-17 01:26:44
@article{5a9c6f7a-d682-485f-a576-8a7b2af9de44,
  abstract     = {{We show that the firm-size distribution is an important determinant of the relationship between an industry's employment and output. A theoretical model predicts that changes in demand for an industry's output have larger effects on employment, resulting from adjustments at both the intensive and extensive margin, in industries characterised by a distribution that has a lower density of large firms. Industry-specific shape parameters of the firm size distributions are estimated using firm-level data from Germany, Sweden and the UK, and used to augment a relationship between industry-level employment and output. The empirical results align with the predictions of the theory.}},
  author       = {{Görg, Holger and Henze, Philipp and Jienwatcharamongkhol, Viroj and Kopasker, Daniel and Molana, Hassan and Montagna, Catia and Sjöholm, Fredrik}},
  issn         = {{1090-9443}},
  keywords     = {{firm distribution; firm size; employment; fluctuations}},
  language     = {{eng}},
  number       = {{4}},
  pages        = {{690--703}},
  publisher    = {{Academic Press}},
  series       = {{Research in Economics}},
  title        = {{Firm Size Distribution and Employment Fluctuations : Theory and Evidence}},
  url          = {{http://dx.doi.org/10.1016/j.rie.2017.09.002}},
  doi          = {{10.1016/j.rie.2017.09.002}},
  volume       = {{71}},
  year         = {{2017}},
}