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Studying Firm Growth Distributions with a Large Administrative Employment Database

Author

Listed:
  • Dixon Jay

    (Statistics Canada, 100 Tunney’s Pasture Driveway, Ottawa, Ontario, Canada K1A 0T6)

  • Petrunia Robert

    (Department of Economics, Lakehead University, 955 Oliver Road, Thunder Bay, Ontario, Canada P7B 5E1)

  • Rollin Anne-Marie

    (Statistics Canada, 100 Tunney’s Pasture Driveway, Ottawa, Ontario, Canada K1A 0T6)

Abstract

This paper uses business tax administrative data to describe the annual firm growth rate distribution in Canada over the 2000–2009 period. This administrative tax database provides a unique lense to study firm growth as it allows us to look at the universe of Canadian employer firms and investigate the firm growth distribution across different dimensions. A non-normal, fat-tailed shape for the firm growth distributions holds across years, industries, regions, as well as firm size and age classes. The results show that the distributions of employment growth rates in Canada have more density in both the center and tails than a normal distribution. The evidence paints a picture of firm growth dynamics whereby most firms change very little each year, while a nontrivial amount also markedly grow or decline. A final finding is that young firms, aged four or less, represent a special case with an upwardly skewed distribution and a median growth rate greater than zero.

Suggested Citation

  • Dixon Jay & Petrunia Robert & Rollin Anne-Marie, 2018. "Studying Firm Growth Distributions with a Large Administrative Employment Database," Journal of Economics and Statistics (Jahrbuecher fuer Nationaloekonomie und Statistik), De Gruyter, vol. 238(3-4), pages 189-221, July.
    • Handle: RePEc:jns:jbstat:v:238:y:2018:i:3-4:p:189-221:n:2
    DOI: 10.1515/jbnst-2018-0015
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    References listed on IDEAS

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    More about this item

    Keywords

    administrative data; firm growth;

    JEL classification:

    • L11 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - Production, Pricing, and Market Structure; Size Distribution of Firms

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