Impeded Industrial Restructuring: The Growth Penalty

31 Pages Posted: 29 Jan 2001

See all articles by David B. Audretsch

David B. Audretsch

Indiana University - Institute for Development Strategies; King Saud University; WHU - Otto Beisheim School of Management; Indiana University Bloomington - School of Public & Environmental Affairs (SPEA)

Martin A. Carree

University of Maastricht - Department of Organization & Strategy

Andre J. van Stel

Max Planck Society for the Advancement of the Sciences - Max Planck Institute for Economics

Roy Thurik

Montpellier Business School; Erasmus University Rotterdam (EUR) - Centre for Advanced Small Business Economics (CASBEC); Erasmus Research Institute of Management (ERIM); EIM Netherlands - Business and Policy Research; Tinbergen Institute

Multiple version iconThere are 2 versions of this paper

Date Written: December 2000

Abstract

This paper documents that a process of industrial restructuring has been transforming the developed economies, where large corporations are accounting for less economic activity and small firms are accounting for a greater share of economic activity. Not all countries, however, are experiencing the same shift in their industrial structures. Very little is known about the cost of resisting this restructuring process. The goal of this paper is to identify whether there is a cost, measured in terms of foregone growth, of an impeded restructuring process. The cost is measured by linking growth rates of European countries to deviations from the optimal industrial structure. The empirical evidence suggests that countries impeding the restructuring process pay a penalty in terms of foregone growth.

Keywords: Economic Growth, Entrepreneurship, Firm Size Distribution, Industry Structure

JEL Classification: L11, O11

Suggested Citation

Audretsch, David B. and Carree, Martin A. and van Stel, Andre J. and Thurik, Roy, Impeded Industrial Restructuring: The Growth Penalty (December 2000). CEPR Discussion Paper No. 2648. Available at SSRN: https://ssrn.com/abstract=258081

David B. Audretsch (Contact Author)

Indiana University - Institute for Development Strategies ( email )

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King Saud University ( email )

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WHU - Otto Beisheim School of Management ( email )

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Indiana University Bloomington - School of Public & Environmental Affairs (SPEA) ( email )

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Martin A. Carree

University of Maastricht - Department of Organization & Strategy ( email )

P.O. Box 616
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Andre J. Van Stel

Max Planck Society for the Advancement of the Sciences - Max Planck Institute for Economics ( email )

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Germany

Roy Thurik

Montpellier Business School

France

Erasmus University Rotterdam (EUR) - Centre for Advanced Small Business Economics (CASBEC) ( email )

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Tinbergen Institute ( email )

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