Scandinavian Working Papers in Economics

HUI Working Papers,
HUI Research

No 84: Accounting for Job Growth: Disentangling Size and Age Effects in an International Cohort Comparison

Michael Anyadike-Danes , Carl-Magnus Bjuggren , Sandra Gottschalk , Werner Hölzl , Dan Johansson (), Mika Maliranta and Anja Myrann
Additional contact information
Michael Anyadike-Danes: Aston University, Postal: Aston Business School and Enterprise Research CentreAston Triangle, Birmingham, B4 7ET, United Kingdom
Carl-Magnus Bjuggren: Linköping University, Postal: Institutionen för ekonomisk och industriell utveckling, 581 83, Linköping, Sweden
Sandra Gottschalk: Centre for European Economic Research (ZEW), Postal: L7,1 , D-68161 Mannheim , Germany
Werner Hölzl: Austrian Institute of Economic Research (WIFO), Postal: Arsenal, Objekt 20 , 1030 Vienna, Austria
Dan Johansson: HUI Research, Postal: SE-103 29 Stockholm, Sweden;Dalarna University, 791 88 Falun, Sweden
Mika Maliranta: The Research Institute of the Finnish Economy (ETLA), Postal: Lonnrotinkatu 4 B, FI-00120 Helsinki, Finland;Jyväskylä University School of Business and Economics, P.O.Box 35, FI-40014 University of Jyväskylä, Finland
Anja Myrann: Ragnar Frisch Centre for Economic Research, Postal: Gaustadalléen 21, NO-0349 Oslo, Norway

Abstract: The contribution of different-sized businesses to job creation continues to attract policymakers’ attention, however, it has recently been recognized that conclusions about size were confounded with the effect of age. We probe the role of size, controlling for age, by comparing the cohorts of firms born in 1998 over their first decade of life, using variation across half a dozen northern European countries Austria, Finland, Germany, Norway, Sweden, and the UK to pin down the effects. We find that a very small proportion of the smallest firms play a crucial role in accounting for cross-country differences in job growth.

Keywords: employment; business size; business age; cohorts; job creation

JEL-codes: E24; L25; M13

41 pages, March 13, 2013

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