Determinants of plant closures in Swedish manufacturing

Fredrik Andersson () and Altin Vejsiu
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Fredrik Andersson: IFAU - Office of Labour Market Policy Evaluation, Postal: Labour Market Policy Evaluation, P O Box 513, SE-751 20 Uppsala, Sweden, http://www.ifau.se
Altin Vejsiu: IFAU - Office of Labour Market Policy Evaluation, Postal: Labour Market Policy Evaluation, P O Box 513, SE-751 20 Uppsala, Sweden, http://www.ifau.se

No 2001:6, Working Paper Series from IFAU - Institute for Evaluation of Labour Market and Education Policy

Abstract: We study the derminants of plant closures i Swedish manufacturing using linked employer-employee data. From our theoretical framework we derive and empirically test hypothesis regarding the linkages between the probability of plant failure and: 1) industry-specific characteristics of production and product demand; 2) local labor market conditions; and 3) plant-specific sources of heterogeneity, including the importance of insider mechanisms in wage determination, plant specific human capital, selection mechanisms and technology vintage effects. Our results suggest that all these factors matter in ways that by and large conform to the a priori hypotheses.

Keywords: Plant closures; job reallocation; insider wage determination; selection mechanisms; capital vintage effects; linked employer-employee data (search for similar items in EconPapers)
JEL-codes: J21 J23 (search for similar items in EconPapers)
Pages: 41 pages
Date: 2001-06-15
New Economics Papers: this item is included in nep-lab
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Citations: View citations in EconPapers (8)

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