In case you missed it: Earlier today, I hosted a special call to discuss declining business dynamism. Americans often view their economy as increasingly fast-paced, competitive, and entrepreneurial, full of "disruption" and accelerating turnover: Just look at the overnight success of Facebook and Airbnb, or the sudden demise of Toys R Us and The Limited. But this view is increasingly contradicted by the data. In fact, labor mobility and firm startups are declining; the typical firm is getting larger and older; industry concentration is rising; and superstar incumbents are breaking away from the pack.
This presentation is a wide-ranging, chart-filled tour through the emerging economic literature on "declining business dynamism"--what it is, why it matters, what's causing it, and what it means for policymakers and market performance.
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PRESENTATION OUTLINE
- Why declining business dynamism matters: Slowing productivity growth
- Nine indicators of declining business dynamism
- 1) declining rates of job creation and destruction
- 2) declining rates of job churn and geographic mobility
- 3) declining rates of company start-ups and firm turnover
- 4) declining number of total firms and (especially) listed firms
- 5) growing age and size of typical firm
- 6) declining turnover/turbulence in S&P 100 giants
- 7) weakening firm response to productivity gaps
- 8) rising market concentration
- 9) a widening divide between winners and losers
- Possible causes of decline
- Implications for policy and for market performance
Please call or e-mail with any questions.
