Business Conditions and Business Starts

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Abstrakt

This paper analyses the effect of business conditions on new firm starts. The birth of new firms displays a pro-cyclical behaviour, more firms being created when GDP is growing fast and the interest rate is low. The entry response to industry profitability is tempered by the level of sunk costs; for a given profit signal, more entry occurs where sunk costs are low.
OriginalsprogEngelsk
TidsskriftInternational Journal of the Economics of Business
Vol/bind3
Udgave nummer3
Sider (fra-til)295-306
Antal sider12
ISSN1357-1516
DOI
StatusUdgivet - 1996
Udgivet eksterntJa

Emneord

  • Entry
  • Business starts
  • Sunk costs

Citationsformater