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Project

Economic policy and firm growth - Micro-econometric studies at the firm level

In the last decades, both policy makers in industrialized countries and academic scholars have broadly acknowledged the importance of small and medium-sized companies (SMEs) as backbone of the economic system in addition to the dominating large firms leading world markets. Particularly small, young high-tech companies have been identified as major source for future growth opportunities and welfare. However, these companies are also known to be most constrained with respect to financing their business and innovation ideas. They might also be restricted by other business conditions, e.g. laws on minimum wages and other rigid regulations. This project aims at evaluating some recent European policies either directly aimed at small and young innovators or others like the introduction of minimum wages which may affect small and young companies disproportionately. In particular, we exploit law changes to establish causal treatment effects of the policies using modern state-of-the-art micro-econometric techniques and big data in order to investigate the heterogeneity of policies in different subpopulations of the economy. We evaluate a new Italian business law subsidizing the access to equity and debt capital as well as relaxing labor market regulations. In addition, we investigate the effects of the introduction of minimum wages in Germany on the growth of (innovative) start-ups. Finally, we also investigate a law change in public procurement legislation.

Date:1 Jan 2018 →  31 Dec 2021
Keywords:Economic policy, Firm growth, Medium-sized companies
Disciplines:Applied economics, Economic history, Macroeconomics and monetary economics, Microeconomics, Tourism