Author:

Keywords:

Job creation and destruction, Firm dynamics

Abstract:

In market economies, firms are the main drivers of job creation and job destruction. This thesis focuses on two crucial stages in the life-cycle of firms that involve a large amount of job reallocation: the early years after startup and the period when two firms merge into a single company. The first stage is believed to be a major source of job creation. The second is associated with massive job loss. I investigate whether these common perceptions are supported by empirical evidence, and show that the employment outcomes differ strongly depending on the firm’s individual characteristics. To analyze these questions we need data that accurately reflect the dynamics of firms and employment in the economy. This issue is addressed first.