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Title:The effects of new business formation on regional development over time PDF Logo
Authors:Fritsch, Michael
Mueller, Pamela
Issue Date:2004
Series/Report no.:Papers on entrepreneurship, growth and public policy 3604
Abstract:In our analysis of the impact of new business formation on regional employment change we identified considerable time lags. We investigated the structure and extent of these time lags by applying the Almon lag model and found that new firms can have both a positive and a negative effect on regional employment. The results indicate that the indirect effects of new business formation (crowding-out of competitors, improvement of supply conditions and improved competitiveness) are of greater magnitude than the direct effect, i.e. the jobs that are created in the new entities. The peak of the positive impact of new businesses on regional development is reached about eight years after entry.
Subjects:Regional growth
new businesses
entrepreneuship
time lags
JEL:R11
O18
O1
M13
Document Type:Working Paper
Appears in Collections:Discussion Papers on Entrepreneurship, Growth and Public Policy, MPI für Ökonomik

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