du.sePublications
Change search
Link to record
Permanent link

Direct link
BETA
Bornhäll, Anders
Publications (3 of 3) Show all publications
Bornhäll, A., Daunfeldt, S.-O. & Rudholm, N. (2017). Employment protection legislation and firm growth: Evidence from a natural experiment. Industrial and Corporate Change, 26(1), 169-185
Open this publication in new window or tab >>Employment protection legislation and firm growth: Evidence from a natural experiment
2017 (English)In: Industrial and Corporate Change, ISSN 0960-6491, E-ISSN 1464-3650, Vol. 26, no 1, p. 169-185Article in journal (Refereed) Published
Abstract [en]

A Swedish reform in 2001 made it possible for firms with less than 11 employees to exclude two from the last-in-first-out principle in case of layoffs. The reform increased employment growth with over 4000 additional jobs per year among firms with five to nine employees. Firms with 10 employees became 3.4 percentage points less likely to increase their workforce, indicating that the introduced threshold kept them from growing. Thus, employment protection legislation seems to act as a growth barrier for small firms.

National Category
Economics
Research subject
Complex Systems – Microdata Analysis
Identifiers
urn:nbn:se:du-22583 (URN)10.1093/icc/dtw017 (DOI)000397116700008 ()
Available from: 2016-07-06 Created: 2016-07-06 Last updated: 2017-11-28Bibliographically approved
Bornhäll, A. (2017). Unseen job creators and firm growth barriers: the role of capital constraints and seniority rules. (Doctoral dissertation). Örebro: Örebro University
Open this publication in new window or tab >>Unseen job creators and firm growth barriers: the role of capital constraints and seniority rules
2017 (English)Doctoral thesis, comprehensive summary (Other academic)
Abstract [en]

The topic of this thesis is to provide a deeper understanding of how the institutional framework affects firms’ hiring decisions.

The first article focuses on a group of firms, called sleeping gazelles, that do not grow despite having high profits. Sleeping gazelles constitute a much larger share of the firm population than that of high-growth firms. If it is growth barriers that are hindering these firms from hiring more employees, many new jobs could be created if these barriers were removed. To investigate the effects of one of the suggested growth barriers in the literature, the second article, focuses on whether small-firm growth is hampered by lack of capital. Using survey data from business owners matched with register data, we find that firms may face a capital constraint paradox, whereby the supply of external capital might be sufficient, but firm owners might refrain from accessing it due to fear of losing control of their companies. The third article investigates whether employment protection acts as a growth barrier in Sweden. Using a reform of the Swedish last-in-first-out (LIFO) rule, we estimate the causal effects from a liberalization of the employment protection. We find that firm growth increased because of the reform and that a more expansive reform could provide new job opportunities and increase overall employment. The LIFO rule was introduced to protect older workers. The fourth article investigates whether the reform weakened the labor market position of these workers. It is found that more young individuals who were unemployed or previously not in the workforce were hired as a consequence of the reform, showing that the reform lowered youth unemployment. There is no indication of older workers leaving the workforce or becoming unemployed to any greater extent after the reform. The fifth article show that the positive effects of the reform were limited to native workers, with no effects on the labor market position of immigrants. The effects depend on the relative insider-status of employees, so that groups of employees who are closer to being insiders benefit more from less-strict employment protection legislation than groups that are further from being insiders.

Place, publisher, year, edition, pages
Örebro: Örebro University, 2017. p. 54
Keywords
Firm growth, growth barriers, employment protection, institutions, capital constraints
National Category
Economics
Research subject
Complex Systems – Microdata Analysis
Identifiers
urn:nbn:se:du-26541 (URN)978-91-7529-207-6 (ISBN)
Public defence
2017-10-06, Örebro universitet, Musikhögskolan, Hörsal M, 13:15 (English)
Opponent
Supervisors
Available from: 2017-11-10 Created: 2017-11-10 Last updated: 2017-11-10Bibliographically approved
Bornhäll, A., Daunfeldt, S.-O. & Rudholm, N. (2014). Sleeping gazelles: High profits but no growth. Frontiers of Entrepreneurship Research, 34(17), 1-16, Article ID 1.
Open this publication in new window or tab >>Sleeping gazelles: High profits but no growth
2014 (English)In: Frontiers of Entrepreneurship Research, ISSN 0740-7416, Vol. 34, no 17, p. 1-16, article id 1Article in journal (Refereed) Published
Abstract [en]

Among 104,231 limited liability firms in Sweden with at least two employees during 1997- 2010, almost 10% did not hire new employees in any given 3-year period despite having high profits. Nearly half of these firms continued to have high or medium profits in the next threeyear period, but still no growth. Regression analysis indicates that these firms were not randomly distributed; rather they were small and young, did not belong to an enterprise group, and operated in local markets with high profit-opportunities. We conclude that it might be more beneficial to focus policy towards these firms instead of towards a few high-growth firms that, having just grown exponentially, may not be best positioned to grow further.

National Category
Economics
Research subject
Complex Systems – Microdata Analysis
Identifiers
urn:nbn:se:du-23611 (URN)
Available from: 2016-12-19 Created: 2016-12-19 Last updated: 2017-11-29Bibliographically approved
Organisations

Search in DiVA

Show all publications