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Channels of Size Adjustment and Firm Performance

Breinlich, H and Niemann, S and Solomon, E (2011) Channels of Size Adjustment and Firm Performance. UNSPECIFIED. University of Essex, Department of Economics, Economics Discussion Papers 703.

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Abstract

We use unique business register data for the United Kingdom to investigate the effects of different forms of firm expansion and contraction on firm-level performance indicators such as wages and productivity. We distinguish between adjustment of employment and turnover at existing establishments, expansions and contractions taking place via greenfield investment and disinvestment, and via acquisitions and sell-offs. We show that the choice of adjustment channel has important implications for the evolution of firm-level performance indicators. In terms of aggregate importance, we demonstrate that the two external adjustment forms (greenfield and M&A) account for at least 50% of the changes in aggregate wages, profits and productivity associated with firm expansions and contractions.

Item Type: Monograph (UNSPECIFIED)
Subjects: H Social Sciences > HB Economic Theory
Divisions: Faculty of Social Sciences > Economics, Department of
Depositing User: Jim Jamieson
Date Deposited: 03 Jul 2012 11:33
Last Modified: 17 Aug 2017 18:11
URI: http://repository.essex.ac.uk/id/eprint/2730

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