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  3. American Economic Review
  4. May 2016
  5. Firm Entry and Macroeconomic Dynamics: A State-Level Analysis

Firm Entry and Macroeconomic Dynamics: A State-Level Analysis

  • François Gourio
  • Todd Messer
  • Michael Siemer
American Economic Review
vol. 106, no. 5, May 2016
(pp. 214-18)
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Abstract

Using an annual panel of US states over the period 1982-2014, we estimate the response of macroeconomic variables to a shock to the number of new firms (startups). We find that these shocks have significant effects that persist for many years on real GDP, productivity, and population. This is consistent with simple models of firm dynamics where a "missing generation" of firms affects productivity persistently.

Citation

Gourio, François, Todd Messer, and Michael Siemer. 2016. "Firm Entry and Macroeconomic Dynamics: A State-Level Analysis." American Economic Review, 106 (5): 214-18. DOI: 10.1257/aer.p20161052

Additional Materials

JEL Classification

  • D22 Firm Behavior: Empirical Analysis
  • E23 Macroeconomics: Production
  • E32 Business Fluctuations; Cycles
  • L11 Production, Pricing, and Market Structure; Size Distribution of Firms
  • L26 Entrepreneurship
  • M13 New Firms; Startups