the evolution of high incomes in northern america lessons from canadian evidence this paper uses tax statistics to construct new series on canadian top income shares from 1920 to 2000 and provides a systematic comparison with the u s experience as in the united states top income shares in canada display a ushaped pattern over the century with a precipitous drop during world war ii followed by a slower decline until 1970 since the late 1970s top income shares have been increasing dramatically and the very top shares are now as high as in the pre war era as in the united states the recent increase in top income shares is the consequence of a surge in top wages and salaries the canadian experience since the late 1970s does not appear to be well explained by tax changes suggesting that the upward trend in canada derives from the united states perhaps because many high income canadians have an emigration option this in turn suggests that the recent increase in u s personal income top shares is not merely a change in tax reporting behavior the recent sharp increase in top income shares in canada is of the same magnitude at the individual and family level and is not due to an increase in income mobility

the wage gap between francophones and anglophones a canadian perspective 1970 2000 the wage gap between francophone and anglophone men from 1970 and 2000 fell by 25 percentage points within quebec but only by 10 points canada wide largely because the wages of quebec anglophones fell by 15 points relative to other canadian anglophones accordingly the canadian measure of the francophone gap better reflects the changing welfare of francophones than the quebec measure over half of the reduction in the canadian francophone wage gap is explained by rising francophone education levels in quebec the declining number and relative wages of anglophone workers is best explained by a falling demand for english speaking labour l ecart de salaires entre les hommes francophones et anglophones est tombe de 25 points de pourcentage au quebec entre 1970 et 2000 mais seulement de 10 points a l echelle canadienne largement parce que les salaires des anglophones au quebec sont tombes de 15 points par rapport aux autres canadiens anglophones en consequence la mesure canadienne de l ecart prend mieux la mesure du changement de bien etre des francophones que la mesure quebecoise plus de la moitie de la reduction dans l ecart au niveau canadien s explique par l accroissement des niveaux d education des francophones au quebec le nombre en declin des travailleurs anglophones et la chute de leurs salaires relatifs s expliquent par un declin dans la demande de travailleurs parlant anglais

testing gibrat s law for small young and innovating firms this article analyses whether small young and innovating firms have experienced a greater employment growth than other spanish firms over the period 1990 2000 the study draws upon a sample of 1272 manufacturing firms in which only 967 of the firms survived for the entire ten year period the analyses test gibrat s law both by least squares and by utilizing the procedure proposed by heckman in which a probit survival equation is first estimated to correct for sample selection bias two estimators correcting for selection bias are utilized one that incorporates the inverse mill s ratio and the other that employs maximum likelihood methods all the results reject gibrat s law and support the proposition that small firms have grown larger additionally the results show that old firms grow less than young ones and innovating activity both process and product is a strong positive factor in the firm s survival and its employment growth

quality of life firm productivity and the value of amenities across canadian cities we estimate quality of life and productivity differences across canada s metropolitan areas in a hedonic general equilibrium framework these are based on the estimated willingness to pay of heterogeneous households and firms to locate in various cities which differ in their wage levels housing costs and land values using 2006 canadian census data our metropolitan quality of life estimates are somewhat consistent with popular rankings yet find canadians care more about climate and culture quality of life is highest in victoria for anglophones montreal for francophones and vancouver for allophones and lowest in more remote cities toronto is canada s most productive city vancouver is the overall most valuable city qualite de vie productivite des entreprises et la valeur des avantages dans les diverses villes canadiennes on evalue les differences entre la qualite de vie et la productivite des entreprises entre les zones metropolitaines au canada a l aide d un cadre d analyse d equilibre general hedonique ces metriques sont basees sur l estimation de la volonte de payer de menages et d entreprises heterogenes pour se localiser dans diverses villes qui different tant pour ce qui est des niveaux de salaires des couts de l habitation et des prix des terrains a l aide des donnees du recensement canadien de 2006 on construit des evaluations de la qualite de vie des diverses zones metropolitaines qui s arriment convenablement aux ordonnancements en vogue mais on decouvre que les canadiens portent une attention particuliere au climat et a la culture la qualite de vie est la plus elevee a victoria pour les anglophones a montreal pour les francophones et a vancouver pour les allophones et la plus faible pour les villes eloignees des grands centres toronto est la ville la plus productive vancouver est generalement la plus appreciee

the direct employment effects of new businesses in germany revisited an empirical investigation for 1976 2004 based on an improved and extended database the establishment history panel we extend the analysis of fritsch and weyh small business economics 27 2 245 260 2006 by investigating the development of employment in german start up cohorts for the period 1976 to 2004 we confirm the typical pattern found in start up cohorts an initial increasing number of employees that is soon followed by a decreasing number we also provide some of the first evidence for the liability of aging phenomena in germany older firms face a relatively high risk of exit we find that most entries with relatively large initial employment grow substantially in the first two decades however these businesses suffer from a considerable employment decline after 25 years

no deep pockets some stylized empirical results on firms financial constraints this paper is a survey of recent empirical work on financial constraints faced by firms it is organized as a series of stylized results which mirror what is generally understood about the severity of financial constraints and the effects that they have upon firms the review of the literature shows that a financial constraints are a widespread key concern for firms hindering their ability to carry out their optimal investment and growth trajectories and b the severity of such constraints depends on institutional and firm specific characteristics as well as on the nature of investment projects

equilibria and efficiency in bilingual labour markets abstract we consider a labour market where two languages are commonly in use and each individual may make a costly investment to learn the language which is not his or her mother tongue language skills are productive in a human capital sense and can also be used to signal unobservable traits to employers due to the informational asymmetry between workers and employees the equilibrium rate of bilingualism in the economy may exceed the socially efficient level on the other hand the spillovers associated with second language acquisition may imply there is not enough bilingualism relative to the social optimum we consider the circumstances under which either the signalling or the network welfare effects dominate in equilibrium depending on the parameter values of the model policies of either encouraging or discouraging the investment in language skills may be welfare enhancing

a time to grow and a time to die growth and mortality of credit unions in new york city 1914 1990 one vision of organizational evolution suggests that old and large organizations become increasingly dominant over their environment a second suggests that as organizations age they become less able to respond to new challenges in this article the authors investigate which of these visions best characterizes the evolution of state chartered credit unions in new york city from 1914 through 1990 by analyzing the effects of organizational age size and population density on rates of organizational failure and growth the authors find evidence that old and small institutions are more likely to fail while young and small organizations have the highest growth rates

the death of firms exploring the effects of environment and birth cohort on firm survival in sweden this paper investigates the death of firms and seizes a long term perspective it investigates the life spans of nearly 2 200 firms in seven birth cohorts of swedish joint stock companies founded during seven separate years between 1899 and 1950 research has traditionally emphasized individual and micro oriented factors in explaining post entry performance or has often focused on the influence of firm specific structural factors firm age and size a less attended field recognizes environmental forces this paper focuses on the interaction between the micro and macro levels and combines structural and environmental factors employing a cohort approach it relates firm survival to firm age and size as well as to the effect of cohort affiliation and environmental change over time period effects during macroeconomic expansion the risk of death decreases cohort effects are also evident firms founded during times of economic crisis exhibit lower survival rates consequently cohort affiliation and environmental forces i e period effects can explain differences in death rates in different firm populations

wages rents and the quality of life this study focuses on the role of wages and rents in allocating workers to locations with various quantities of amenities the theory demonstrates that if the amenity is also productive then the sign of the wage gradient is unclear while the rent gradient is positive the theory is extended to include the housing market and nontraded goods these extensions require little modification of the conclusion the empirical work on wages shows that the regional wage differences can be explained largely by these local attributes with the use of site price data implicit prices are estimated and quality of life rankings for the cities are computed

turbulence in growing and declining industries turbulence over the industry life cycle is examined for the case of portugal using the lowest possible level of industry aggregation thus allowing for the use of panel data to study the evolution of product markets replacement of exiting firms by subsequent entrants plays a primary role in generating turbulence in high growth markets while displacement of incumbents by recent entrants is the main selection force in declining markets as the industry life cycle progresses trial and error entry and entry mistakes decrease and turbulence subsides

comparative analysis of firm demographics and survival evidence from micro level sources in oecd countries in this paper we present cross country evidence on firm size distribution firm demographic and post entry performance for 10 oecd countries we use harmonized firm level data drawn from business registers or social security records these data enable international comparisons and the identification of idiosyncratic country effects while average firm size differs across countries due to both sectoral specialization and within sector characteristics we find similar degrees of firm churning across countries in most of them about 20 of firms enter and exit most markets every year and about 20 40 of entering firms fail within the first 2 years of life however post entry growth of successful entrants is much higher in the usa than in europe which may be indicative of barriers to firm growth as opposed to barriers to entry

learn english not the local language ethnic russians in the baltic states this paper analyzes the return to dominant language fluency for ethnic russians in the baltic states we look at male workers using estonian labor force survey for years 2000 2010 and the 1998 wave of a panel of high school graduates of 1982 the results indicate that the ethnic russian men enjoy little income premium on their skills of the dominant language we identify positive returns only in the low end of the income distribution and in public administration sector surprisingly the returns to english fluency are far larger these outcomes point toward segregation and discrimination at the upper end hiring

political uncertainty and asset valuation evidence from business relocations in canada abstract quebec s drive for sovereignty from canada has been the source of political uncertainty for decades in canada this paper studies empirically stock market s reaction to the announcements of business relocations from the province of quebec to other provinces within canada similar announcements about toronto are used for control empirical results show that the market s reaction to the announcements of business relocations a from quebec is positive b from toronto is negative and c to toronto is positive the difference in abnormal returns between the quebec and toronto samples is positive and significant

market selection along the firm life cycle this paper analyses market selection in french manufacturing goods markets over the last decade under the hypothesis that the competitive challenges which firms have to face may change along its life cycle we find that on average exiting firms display below average performance levels in terms of profitability and productivity moreover young firms are challenged not because of their relative efficiency they rapidly reveal themselves more efficient than old firms but in terms of industry concentration and turbulence this result reveals the presence of barriers to firm growth as an important driver of industry dynamics

establishment exits in germany the role of size and age using comprehensive data for west germany this paper investigates the determinants of establishment exit we find that between 1975 and 2006 the average exit rate has risen considerably in order to test various liabilities of establishment survival identified in the literature we analyzed the impact of establishment size and put a special focus on differences between young and mature establishments our empirical analysis shows that the mortality risk falls with establishment size which confirms the liability of smallness the probability of exit is substantially higher for young establishments which are not more than 5 years old thus confirming the liability of newness there also exists a liability of aging since exit rates first decline over time reaching a minimum at ages 15 18 and then rise again somewhat the determinants of exit differ substantially between young and mature establishments suggesting that young establishments are more vulnerable in a number of ways

post entry behaviour and the cycle evidence from germany abstract based on a rich database on establishments in western germany the paper aims at characterising the relationship between on the one hand growth and exit of entering cohorts and on the other hand aggregate business fluctuations a main finding is that exit is not responsive to the cycle which is at odds with views of recessions as times of cleansing where creative destruction processes occur the growth of survivors also displays little cyclical sensitivity but tends to become more responsive to aggregate business fluctuations as the cohort ages two possible explanations for this role of age on the cyclical sensitivity of surviving units are offered in the final section of the paper the first draws on the product specialisation of young and more established plants the second on the role of irreversible investment and industry selection

earnings by language group in quebec in 1980 and emigration from quebec between 1976 and 1981 between 1976 and 1981 many pople moved out of quebec especially anglophones to the extent that a persons decision to stay or to move may be related to earnings prospects earnings comparisons with individuals who lived in quebec in 1981 may suffer from a selection bias this paper analyses emigration from quebec and earnings with a two equation model using a sample of men drawn from the from the 1981 canadian census it is found that a selection bias is indeed present for anglophones and that the returns to learning french may be underestimated when that bias is ignored excerpt

the life history of cohorts of exits from german manufacturing an investigation of the life history of three cohorts of exits based on longitudinal data covering the population of all manufacturing firms in a german federal state reveals three empirical regularities 1 although the probability of exit tends to decline with age ceteris paribus only about a quarter of all exits is from the group of young firms aged five years or less 2 only a minor fraction of exits lived through a period of continous decline of employment for five years or more before closing down 3 the impact effect of job loss due to exits can differ sharply from the long run effect

the post entry performance of new small firms in german manufacturing industries while recent years have witnessed a growing interest in research on market entry by new firms evidence regarding their postentry performance is scarce this paper uses longitudinal data for small firms that entered german manufacturing industries between 1979 and 1982 and monitors their performance until 1990 entrants face a high risk of failure hazard rates tend to increase during the first years and to decrease afterwards decline of employment in a cohort due to exits and shrinking firms is compensated by growing survivors no clear cut nexus between start up size and probability of survival shows up copyright 1994 by blackwell publishing ltd

the survival of new plants start up conditions and post entry evolution abstract this paper examines the longevity of entrants we find size to be an important determinant of the chances of survival this being particularly relevant to de novo entrants as compared with entry by established firms current size is also found to be a better predictor of failure than initial size moreover our findings indicate that after controlling for size differences past growth matters for survival suggesting a partial adjustment process for firm size in the post entry period finally new plants are more likely to live longer if they enter growing industries or industries with little entry activity

general equilibrium and international trade with exhaustible resources the pricing of raw materials from an exhaustible resource is predominantly analysed within the context of a partial equilibrium it is argued here that there are good reasons for a general equilibrium analysis in this paper we present an international trade model with exhaustible resources and characterize the general equilibrium properties the general perspective adopted leads to new insights compared with a partial equilibrium approach

the scarring effect of recessions abstract according to the conventional view recessions improve resource allocation by driving out less productive firms this paper posits an additional scarring effect recessions impede the developments of potentially superior firms by destroying them during their infancy a model is developed to capture both the cleansing and the scarring effects a key ingredient of the model is that idiosyncratic productivity is not directly observable but can be learned over time when calibrated with statistics on entry exit and productivity differentials the model suggests that the scarring effect dominates the cleansing effect and gives rise to lower average productivity during recessions