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This paper analyses how firm births and deaths are influenced by previous firm births and deaths in related and unrelated sectors. Competition and multiplier effects are used as the theoretical lens for this analysis.

This paper uses 2008–2016 Irish business demography data pertaining to 568 NACE 4-digit sectors within 20 NACE 1-digit industries across 34 Irish county and sub-county regions within 8 NUTS3 regions. A three-stage least squares (3SLS) estimation is used to analyse the impact of past firm deaths (births) on future firm births (deaths). The effect of relatedness on firm interrelationships is explicitly modelled and captured.

Findings indicate that the multiplier effect operates mostly through related sectors, while the competition effect operates mostly through unrelated sectors.

This paper's findings show that firm interrelationships are significantly influenced by the degree of relatedness between firms. The raw data used to calculate firm birth and death rates in this analysis are count data. Each new firm is measured the same as another regardless of differing features like size. Some research has shown that smaller firms have a greater propensity to create entrepreneurs (Parker, 2009). Thus, it is possible that the death of differently sized firms may contribute differently to multiplier effects where births induce further births. Future research could seek to examine this.

These findings have implications for policy initiatives concerned with increasing entrepreneurship. Some express concerns that public investment into entrepreneurship can lead to “crowding out” effects (Cumming and Johan, 2019), meaning that public investment into entrepreneurship could displace or reduce private investment into entrepreneurship (Audretsch and Fiedler, 2023; Zikou et al., 2017). This study’s findings indicate that using public investment to increase firm births could increase future firm births in related and unrelated sectors. However, more negative “crowding out” effects may also occur in unrelated sectors, meaning that public investment which stimulates firm births in a certain sector could induce firm deaths and crowd out entrepreneurship in unrelated sectors.

This paper is the first in the literature to explicitly account for the role of relatedness in firm interrelationships.

The purpose of this paper is to show how self-regulation influences the relationship between nascent entrepreneurial exploitation activities, firm birth and firm abandonment.

This study draws from a unique longitudinal dataset of 181 nascent entrepreneurs from Switzerland who have been interviewed by phone in 2015 and 2016. It uses a moderated binary logistic regression to test the hypotheses.

This study provides evidence that discrepancies in promotion orientation can explain different ways exploitation can lead to an increased likelihood of firm birth and a decreased likelihood of firm abandonment while respectively increasing persistence. Findings suggest that this is attributed to the regulatory fit between a promotion orientation and exploitation activities.

For scholars, our findings provide insights into reasons for entrepreneurial persistence, as well as how firm birth can be achieved with different levels of exploitation activities.

This study provides entrepreneurs with information on how to increase their persistence as well as the likelihood of firm birth while considering their regulatory focus.

Based on regulatory focus theory, this paper highlights different paths to firm birth with varying quantity of exploitation activities. We contribute to a greater understanding of firm emergence by accounting for the impact of regulatory foci.

The purpose of this paper is to examine the influence of the institutional environment on firm birth and death rates. It is hypothesized that high taxation levels, large government size, high levels of unionization and high minimum wages will be associated with relatively low firm birth and death rates.

This study makes use of a set of custom tabulations from the US Census Bureau that contain data on county-level firm births and deaths. To account for differences in state policies, matched contiguous counties located on state borders are used to calculate matched birth and death ratios.

In the sample of eastern US state border counties, state taxation levels and minimum wages had no significant relationship with firm birth rates, but there was a negative relationship between state union densities and firm birth rates. Both state education and public welfare expenditures were marginally negatively related to firm birth rates. State public welfare expenditures were negatively related to firm death rates, while a marginally significant negative relationship between hospital/health expenditures and firm death rates was observed.

These results indicate that state government expenditures may have varying influences on firm birth and death rates, and that high union densities may deter new firm entry.

This paper makes use of a county matching technique to help control for confounding variables, allowing for differences in state policies to be better accounted for.

On the basis of behavioural agency theory and resource-based view, this study investigates the influence of family firm birth mode (i.e. indirect-established or direct-established), family entering time on R&D investment and the moderating role of the family entering time on the relationship between birth mode and R&D investment.

The authors collected 2,990 firm-year observations from family firms listed on A-share in China from 2008 to 2016 in the China Stock Market and Accounting Research database. They used pooled regression for data analysis and Tobit regression for robustness checks.

Indirect-established family firms show more inclined behaviour towards R&D investment than direct-established counterparts. Family entering time positively affects the R&D investment of family firms. Moreover, family entering time plays a significant moderating role in the relationship between family firm birth mode (i.e. indirect-established or direct-established) and R&D investment.

To the best of the authors’ knowledge, this work is a pioneering study that introduced the concept of family firm birth mode (i.e. indirect-established or direct-established) and family entering time. This work is novel because it differentiated family firms according to their birth modes, an approach which is a contribution to the existing literature of family firms. Moreover, the investigation of the moderating role of family entering time has also produced notable results that help understand the impact of family entering time on different types of family firms. The interpretation of outcomes according to behavioural agency theory also produced useful insights for future researchers as well as for policymakers.

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.

Firm-specific factors such as size, profitability, growth, risk and complexity, in addition to agency-related issues determine both auditor selection and firm life-cycle stage. This paper aims to examine whether and how the effect of Big-4 auditors (B4As) on client firms’ audit quality varies across firms’ life-cycle stages.

The sample comprises 1,813 firm-year observations in India’s emerging economy from 2011 to 2020. The Modified Jones model and Jones (signed, unsigned) model are used to compute discretionary accruals/audit quality. The authors use Koh et al.’s (2015) methodology to determine the firm life cycle.

The authors’ key findings show that the client firms employing B4As have superior audit quality than those employing non-Big-4 auditors (NB4As). The authors also show that the life-cycle stage significantly impacts the relationship between B4As and a firm’s audit quality. Furthermore, B4A client firms report superior audit quality vis-à-vis NB4A firms only in the birth- and decline-stages. The audit quality of growth- and mature-stage B4A and NB4A client firms is not significantly different.

Implications for managers include the decision to hire B4As. Given that B4As earn a significant fee premium, managers leading birth- and decline-stage firms should hire B4As, while managers of growth- and mature-stage firms should not.

To the best of the authors’ knowledge, this is the first paper to examine the moderating effect of the firm life-cycle stage on the selection of B4As and their impact on audit quality.

Although foreign direct investment and entrepreneurship are potential routes to recovery (Girma and Wakelin, 2001; Lyon et al., 2002), existing literature is divided on the relationship between the two. The purpose of this paper is to examine the influence of foreign investment on the local SME sector after the 2008 financial crisis.

Local authority district data from Great Britain is used to examine the influence of foreign firm employment on the size of the local SME sector as a proportion of all firms, and foreign firm influence on firm births in the locality. In order to control for local geographical, infrastructural and economic conditions regression analysis is used to examine the relationship between foreign business employment and indigenous business activities.

The potential for technological spillovers and spinout activities appears to dominate with firm birth rates higher where there is greater foreign firm employment. However, there is also evidence of crowding out in relation to the existing SME sector, which is found to be reduced in size where foreign influence through employment is greater.

The results here indicating a complementarity relationship between foreign influence on employment and firm births is important for policy makers looking to revive struggling local economies. However, the relevant support needs to be in place to maximise the benefit from the supply of new entrepreneurs generated.

Unlike many other studies the relationship between the SME sector, firm births and foreign influence is considered at a local level and where economic conditions are more uncertain and economic recovery is less taken for granted. A better understanding of the relationship allows more appropriate policy to be developed in order to aid local economies to recover.

This paper analyzes county-level firm births across the United States using a spatial count model that permits spatial dependence, cross-correlation among different industry types, and over-dispersion commonly found in empirical count data. Results confirm the presence of spatial autocorrelation (which can arise from agglomeration effects and missing variables), industry-specific over-dispersion, and positive, significant cross-correlations. After controlling for existing-firm counts in 2008 (as an exposure term), parameter estimates and inference suggest that a younger work force and/or clientele (as quantified using each county’s median-age values) is associated with more firm births (in 2009). Higher population densities is associated with more new basic-sector firms, while reducing retail-firm starts. The modeling framework demonstrated here can be adopted for a variety of settings, harnessing very local, detailed data to evaluate the effectiveness of investments and policies, in terms of generating business establishments and promoting economic gains.

This chapter investigates how regional start-up rates in the knowledge-intensive services and high-tech industries are influenced by knowledge spillovers from both universities and firm-based R&D activities. Integrating insights from economic geography and organizational ecology into the literature on entrepreneurship, we develop a theoretical framework which captures how both supply- and demand-side factors mold the regional bedrock for start-ups in knowledge-intensive industries. Using multilevel data of all knowledge-intensive start-ups across 286 Swedish municipalities between 1994 and 2002 we demonstrate how characteristics of the economic and political milieu within each region influence the ratio of firm births. We find that knowledge spillovers from universities and firm-based R&D strongly affect the start-up rates for both high-tech firms and knowledge-intensive services firms. Further, the start-up rate of knowledge-intensive service firms is tied more strongly to the supply of university educated individuals and the political regulatory regime within the municipality than start-ups in high-tech industries. This suggests that knowledge-intensive service-start-ups are more susceptible to both demand-side and supply-side context than is the case for high-tech start-ups in general. Our study contributes to the growing stream of research that explains entrepreneurial activity as shaped by contextual factors, most notably academic institutions, such as universities that contribute to knowledge-intensive start-ups.

This study aims to describe and explain the design of management accounting and control systems (MACS) in the growth and revival stages of the organizational life‐cycle of the firm. In addition, it explores how the presence of equity capital investors affects the design of MACS in the case firm in its growth and revival stages.

A case study method is adopted to illustrate the design of MACS in the growth and revival stages. The data are analyzed to describe events in the two organizational life‐cycle stages, which are then compared to identify special features of the design of MACS.

The results show that, in contrast to a growth stage, a revival firm develops MACS for the firm's internal managerial and organizational purposes, such as a more diversified business strategy and more diversified organizational structure, as well as for external reasons, such as a more challenging business environment and investors' requirements. Investors require more detailed management accounting information to know how to get a better return on their investments in a revival stage, while investors ensured that the case firm was only using formal MACS in a growth stage.

The life‐cycle approach is the main perspective in data gathering even though this may bias the data. Therefore, not everything may be observed. Even though Friesen and Miller's life‐cycle model allows firm to be established through a merger of several declining firms, the birth of the case firm differs from a typical birth of the firm. This study is exploratory in nature, suggesting new insights that could be followed up in future research.

The information produced by MACS is, at a minimum, equally important in the revival stage as in the growth stage even though MACS are used for different reasons. Therefore, MACS cannot be used in the same way in the revival stage as in the growth stage.

The study describes and explains the design of MACS by comparing the growth and revival stages, while the accounting literature does not traditionally distinguish between growth and revival stages in this respect.