Measuring the Dynamics of Young and Small Businesses

Steven J. Davis, John Haltiwanger, Ronald S. Jarmin, C. J. Krizan, Javier Miranda, Alfred Nucci and Kristin Sandusky

in Producer Dynamics

Published by University of Chicago Press

Published in print March 2009 | ISBN: 9780226172569
Published online February 2013 | e-ISBN: 9780226172576 | DOI:
Measuring the Dynamics of Young and Small Businesses

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This chapter presents an attempt to measure producer dynamics for the business population. The analysis concentrates on forty industries for which smaller and younger businesses play especially important roles. The data reveals that fluctuations in nonemployer size, measured in terms of revenue, from year to year are much larger for nonemployer firms than employer firms. But as nonemployer firms age and grow, the volatility of their revenue stream declines. Migrants are on a trajectory of rapid growth before and during the transition to employer status. In addition, migrants from the nonemployer universe account for a sizable share of young employers in the industries studied. The Integrated Longitudinal Business Database (ILBD) makes it possible to explore the behavior over time of virtually all businesses in the U.S. economy, employers and nonemployers alike, with robust samples and even entire populations.

Keywords: business population; producer dynamics; businesses; nonemployer firms; migrants; young employers; U.S. economy

Chapter.  12674 words.  Illustrated.

Subjects: Microeconomics

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