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The contribution of start-ups and young firms to industry-level efficiency growth

Michel Dumont UGent, Glenn Rayp UGent, Marijn Verschelde and Bruno Merlevede UGent (2016) APPLIED ECONOMICS. 48(59). p.5786-5801
abstract
This article examines the impact of start-ups (active for 1 up to 5 years) and young firms (active for 6 up to 10 years) on industry-level efficiency growth in six EU countries, covering the period 2002–2009. Using semi-parametric estimates of meta-frontier efficiency, it is found that surviving entrants gradually raise their efficiency level in all countries considered. Firm-level efficiency growth decreases with firm age, whereas reallocation towards efficient firms contributes more to industry-level growth as firms mature. The relative contribution of start-ups appears to have been important as they actually contributed positively to overall efficiency growth which, over the period under consideration, was negative in most countries, even before the ‘Great Recession’. There are indications of ‘cleansing’, due to the exit of less efficient firms, during the ‘Great Recession’.
Please use this url to cite or link to this publication:
author
organization
year
type
journalArticle (original)
publication status
published
subject
keyword
efficiency, entry and exit, young firms, Start-ups, DYNAMICS, TURNOVER, SURVIVAL, EVOLUTION, INNOVATION, CYCLICALITY, SELECTION, PRODUCTIVITY, POST-ENTRY PERFORMANCE, MANUFACTURING-INDUSTRIES, reallocation, D24, L25, M13, O33
journal title
APPLIED ECONOMICS
volume
48
issue
59
pages
5786 - 5801
Web of Science type
Article
Web of Science id
000385944500007
JCR category
ECONOMICS
JCR impact factor
0.648 (2016)
JCR rank
233/347 (2016)
JCR quartile
3 (2016)
ISSN
0003-6846
DOI
10.1080/00036846.2016.1184381
language
English
UGent publication?
yes
classification
A1
copyright statement
I have transferred the copyright for this publication to the publisher
id
7261423
handle
http://hdl.handle.net/1854/LU-7261423
date created
2016-06-17 19:00:28
date last changed
2016-12-19 15:45:25
@article{7261423,
  abstract     = {This article examines the impact of start-ups (active for 1 up to 5 years) and young firms (active for 6 up to 10 years) on industry-level efficiency growth in six EU countries, covering the period 2002--2009. Using semi-parametric estimates of meta-frontier efficiency, it is found that surviving entrants gradually raise their efficiency level in all countries considered. Firm-level efficiency growth decreases with firm age, whereas reallocation towards efficient firms contributes more to industry-level growth as firms mature. The relative contribution of start-ups appears to have been important as they actually contributed positively to overall efficiency growth which, over the period under consideration, was negative in most countries, even before the {\textquoteleft}Great Recession{\textquoteright}. There are indications of {\textquoteleft}cleansing{\textquoteright}, due to the exit of less efficient firms, during the {\textquoteleft}Great Recession{\textquoteright}.},
  author       = {Dumont, Michel and Rayp, Glenn and Verschelde, Marijn and Merlevede, Bruno},
  issn         = {0003-6846},
  journal      = {APPLIED ECONOMICS},
  keyword      = {efficiency,entry and exit,young firms,Start-ups,DYNAMICS,TURNOVER,SURVIVAL,EVOLUTION,INNOVATION,CYCLICALITY,SELECTION,PRODUCTIVITY,POST-ENTRY PERFORMANCE,MANUFACTURING-INDUSTRIES,reallocation,D24,L25,M13,O33},
  language     = {eng},
  number       = {59},
  pages        = {5786--5801},
  title        = {The contribution of start-ups and young firms to industry-level efficiency growth},
  url          = {http://dx.doi.org/10.1080/00036846.2016.1184381},
  volume       = {48},
  year         = {2016},
}

Chicago
Dumont, Michel, Glenn Rayp, Marijn Verschelde, and Bruno Merlevede. 2016. “The Contribution of Start-ups and Young Firms to Industry-level Efficiency Growth.” Applied Economics 48 (59): 5786–5801.
APA
Dumont, M., Rayp, G., Verschelde, M., & Merlevede, B. (2016). The contribution of start-ups and young firms to industry-level efficiency growth. APPLIED ECONOMICS, 48(59), 5786–5801.
Vancouver
1.
Dumont M, Rayp G, Verschelde M, Merlevede B. The contribution of start-ups and young firms to industry-level efficiency growth. APPLIED ECONOMICS. 2016;48(59):5786–801.
MLA
Dumont, Michel, Glenn Rayp, Marijn Verschelde, et al. “The Contribution of Start-ups and Young Firms to Industry-level Efficiency Growth.” APPLIED ECONOMICS 48.59 (2016): 5786–5801. Print.