Weekly Seminar Series
Benjamin Pugsley from the University of Notre Dame visits the department on October 28th.
Oct 26, 2022
Associate Professor of Economics, Benjamin Pugsley, University of Notre Dame will visit our department in-person Friday October 28th, 2022 at 3p.m. EST.
Benjamin will be presenting a seminar on "Demographic Origins of the Start Up Deficit"
Abstract
We propose a simple explanation for the long-run decline in the U.S. startup rate. It originates from a slowdown in labor supply growth since the late 1970s, largely pre-determined by demographics. This channel can explain roughly 60 percent of the decline and why incumbent firm survival and average growth over the lifecycle have changed little. We show these results in a standard model of firm dynamics and test the mechanism using cross-state variation in labor supply growth. Finally, we show that a longer entry rate series imputed using historical establishment tabulations rises over the 1960-70s period of accelerating labor force growth.
We propose a simple explanation for the long-run decline in the U.S. startup rate. It originates from a slowdown in labor supply growth since the late 1970s, largely pre-determined by demographics. This channel can explain roughly 60 percent of the decline and why incumbent firm survival and average growth over the lifecycle have changed little. We show these results in a standard model of firm dynamics and test the mechanism using cross-state variation in labor supply growth. Finally, we show that a longer entry rate series imputed using historical establishment tabulations rises over the 1960-70s period of accelerating labor force growth.