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On the Persistence of Firm Expansion. The survival of new jobs in Austrian firms

Author

Listed:
  • Böheim, René

    (Department of Economics, University of Linz)

  • Stiglbauer, Alfred

    (Oesterreichische Nationalbank)

  • Winter-Ebmer, Rudolf

    (Department of Economics and Finance, Institute for Advanced Studies and University of Linz; IZA, Bonn; CEPR, London)

Abstract

While the volatility of job creations has been studied extensively, the survival chances of new jobs are less researched. The question when and how to expand a firm is of importance, both from the firm’s and from a macro perspective. Adjustment cost theories and arguments about option values of investment in firm expansion make predictions about the timing, sequencing and form of firm expansions. When we analyze 21 years of job creation in Austria, we find that the survival of new jobs (and of new firms) depends upon the state of the business cycle at the time of job creation, on the number of jobs created, and on firm age. Jobs in new firms last longer than new jobs in continuing firms.

Suggested Citation

  • Böheim, René & Stiglbauer, Alfred & Winter-Ebmer, Rudolf, 2005. "On the Persistence of Firm Expansion. The survival of new jobs in Austrian firms," Economics Series 173, Institute for Advanced Studies.
    • Handle: RePEc:ihs:ihsesp:173
    as

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    File URL: https://irihs.ihs.ac.at/id/eprint/1646
    File Function: First version, 2005
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    References listed on IDEAS

    as
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    More about this item

    Keywords

    Job creation; Business cycle; Reallocation; Persistence;
    All these keywords.

    JEL classification:

    • J23 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Labor Demand
    • J63 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - Turnover; Vacancies; Layoffs
    • E24 - Macroeconomics and Monetary Economics - - Consumption, Saving, Production, Employment, and Investment - - - Employment; Unemployment; Wages; Intergenerational Income Distribution; Aggregate Human Capital; Aggregate Labor Productivity
    • E32 - Macroeconomics and Monetary Economics - - Prices, Business Fluctuations, and Cycles - - - Business Fluctuations; Cycles

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