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dc.titleResearch Insights: How Do Aggregate Shocks Impact Firm Entry and Exit, Affecting Macroeconomic Outcomes During Recessions?
dc.contributor.authorAyres, João
dc.contributor.orgunitDepartment of Research and Chief Economist
dc.date.available2024-12-13T00:12:00
dc.date.issue2024-12-13T00:12:00
dc.description.abstractCredit shocks and COVID-19 lockdown effects significantly impact firm entry and exit rates, more so than traditional productivity shocks. These shocks lead to substantial reductions in firm entry and increases in exits, concentrated among young and small firms. During the Great Recession, credit constraints particularly affected young firms, reducing their entry and increasing exit rates, which contributed to slower economic recovery by limiting new business formation. Changes in firm entry and exit accounted for 1020% of the decline in output and hours worked during recessions, highlighting the critical role of firm dynamics in shaping macroeconomic outcomes during downturns.
dc.format.extent4
dc.identifier.doihttp://dx.doi.org/10.18235/0013330
dc.identifier.urlhttps://publications.iadb.org/publications/english/document/Research-Insights-How-Do-Aggregate-Shocks-Impact-Firm-Entry-and-Exit-Affecting-Macroeconomic-Outcomes-During-Recessions.pdf
dc.identifier.urlhttps://publications.iadb.org/publications/spanish/document/Perspectivas-de-investigacion-como-influyen-los-shocks-agregados-en-la-entrada-y-salida-de-empresas-y-en-los-resultados-macroeconomicos-durante-las-recesiones.pdf
dc.language.isoen
dc.publisherInter-American Development Bank
dc.subjectEconomic Recession
dc.subjectSmall Business
dc.subjectQuarantine
dc.subjectEconomic Recovery
dc.subjectFirms Dynamics
dc.subjectProductivity
dc.subjectExternal Shock
dc.subjectRating
dc.subjectResilience
dc.subjectCoronavirus
dc.subjectEconomy
dc.subjectLabor
dc.subjectCredit Constraint
dc.subjectInformal Firm
dc.subjectLockdown
dc.subjectMacroeconomy
dc.subject.jelcodeD21 - Firm Behavior: Theory
dc.subject.jelcodeD22 - Firm Behavior: Empirical Analysis
dc.subject.jelcodeE24 - Employment • Unemployment • Wages • Intergenerational Income Distribution • Aggregate Human Capital • Aggregate Labor Productivity
dc.subject.jelcodeE32 - Business Fluctuations • Cycles
idb.identifier.pubnumberIDB-CB-00999
idb.operationRG-K1098
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