Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/180519
Authors: 
Konon, Alexander
Fritsch, Michael
Kritikos, Alexander S.
Year of Publication: 
2018
Series/Report no.: 
IZA Discussion Papers No. 11501
Abstract: 
We analyze whether start-up rates in different industries systematically change with business cycle variables. Using a unique data set at the industry level, we mostly find correlations that are consistent with counter-cyclical influences of the business cycle on entries in both innovative and non-innovative industries. Entries into the large-scale industries, including the innovative part of manufacturing, are only influenced by changes in the cyclical component of unemployment, while entries into small-scale industries, like knowledge intensive services, are mostly influenced by changes in the cyclical component of GDP. Thus, our analysis suggests that favorable conditions in terms of high GDP might not be germane for start-ups. Given that both innovative and non-innovative businesses react counter-cyclically in 'regular' recessions, business formation may have a stabilizing effect on the economy.
Subjects: 
new business formation
entrepreneurship
business cycle
manufacturing
services
innovative industries
JEL: 
E32
L16
L26
R11
Document Type: 
Working Paper

Files in This Item:
File
Size
496.42 kB





Items in EconStor are protected by copyright, with all rights reserved, unless otherwise indicated.