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We analyze and assess new evidence on employment dynamics from a new data source – the National Establishment Time Series (NETS). The NETS offers advantages over existing data sources for studying employment dynamics, including tracking business establishment relocations that can contribute to job creation or destruction on a regional level. Our primary purpose in this paper is to assess the reliability of the NETS data along a number of dimensions, and we conclude that it is a reliable data source although not without limitations. We also illustrate the usefulness of the NETS data by reporting, for California, a full decomposition of employment change into its six constituent processes, including job creation and destruction stemming from business relocation, which has figured prominently in policy debates but on which there has been no systematic evidence.

While the strategic management literature suggests that related diversification is superior to unrelated diversification, there is little evidence that acquirers benefit from pursuing related targets. We argue that the empirical literature is plagued by poor measures of relatedness. Moreover, many empirical studies do not control adequately for the characteristics of the market for corporate control. We argue that not only value creation, but also value appropriation, depend on the relatedness of acquirer and target. Using an improved measure of relatedness, we provide empirical evidence that acquirer returns are positively and significantly correlated with relatedness.

A number of states have recently either adopted, or have considered adopting, combined reporting accounting for state income tax purposes. Proponents claim that this policy increases state revenues by obviating certain tax panning techniques, while critics claim this policy causes firms to avoid locating in a state, or to downsize. There has been mixed empirical evidence to support either position. The purpose of this paper is to provide more convincing empirical evidence, which is enabled by a new dataset.

The study uses regression analysis and a new dataset available through Dun & Bradstreet. The analysis employs a firm-specific, difference-in-differences design which controls for trends and specifically identifies multistate firms which might be affected by combined reporting. Specifically, the study examines the economic impacts of the recent adoption of combined reporting by four states in terms of sales and employment changes, moves, births, and deaths. The theoretical scope of the paper uses the economics literature on location choice, combined with traditional tax optimization concepts from the accounting and economics literature.

The results suggest that combined reporting does in fact reduce investment in a state in terms of employment and births, deaths, and moves, and this effect is largest for in-state-based firms. From a policy perspective, this may imply that (ceteris paribus) there is an incentive for firms to move their headquarters/major operations out of combined reporting states and into separate reporting states. Given the recent trend for states to adopt combined reporting, the findings may be important. While imposition of combined reporting may increase state tax revenues, states should also consider that such policies may hurt locally based firms and reduce employment, much more so than for out-of-state-based firms. While firms’ location/expansion decisions are clearly also a function of nontax factors, the results here are broadly consistent with literature reviews which conclude that state business taxes do have an impact on business decision-making.

In addition to contributing to the literature on the economic effects of combined reporting for state income tax purposes, this study also introduces the tax research community to a newly available dataset from Dun and Bradstreet that contains precise locational firm and establishment data for public and private firms, as well as data on births, deaths, and moves. The data allows clear identification of firms that are multistate, as well as affiliate information (including exact name and location of parent); type of legal entity; employment; sales; CEO minority information; government contract data; import/export status; foreign ownership; credit data from D&B and Paydex; and other useful data.

Our study provides an industrial census of the dispersion of Internet technology to commercial establishments in the United States. We distinguish between participation, that is, use of the Internet because it is necessary for all business (e.g. email and browsing) and enhancement, that is, adoption of Internet technology to enhance computing processes for competitive advantage (e.g. electronic commerce).

We find that participation and enhancement display contrasting patterns of dispersion. In a majority of industries, participation has approached saturation levels, while enhancement occurs at lower rates with dispersion reflecting long standing industrial differences in use of computing. In general, lead adopters were drawn from a variety of industries, including many of the same industries that lead adoption of other generations of information technologies; however, the appearance of water transportation and warehousing as leading industries in Internet adoption shows that the Internet influenced establishments where logistical processes played a key role. We find large differences across industries and we caution against inferring too much from the experience in manufacturing despite the widespread availability of data in that sector.

The employment impacts of US Environmental Protection Agency (EPA) brownfield grant sites are examined. Such sites are eligible for tax incentives which can provide additional funds for cleanup. Using establishment data, employment within close proximity to such sites is found to increase during cleanup periods following grants. The employment increase was from non-brownfield establishments, i.e., a “spillover” effect. These employment effects were concentrated in certain industries. This chapter adds to the literature on brownfield redevelopment which has focused on property values. Beyond being the first empirical chapter to systematically investigate such employment effects, the chapter’s results are important in light of the current US administration’s intent to cut EPA funding.