A Structural Empirical Model of Firm Growth, Learning, and Survival

35 Pages Posted: 16 May 2003 Last revised: 17 Jul 2021

See all articles by Jaap H. Abbring

Jaap H. Abbring

Tilburg University - Department of Econometrics & Operations Research; Tilburg University - Center for Economic Research (CentER); Tinbergen Institute; IZA Institute of Labor Economics

Jeffrey R. Campbell

University of Notre Dame; Tilburg University

Multiple version iconThere are 2 versions of this paper

Date Written: May 2003

Abstract

We present a structural model of firm growth, learning, and survival and consider its identification and estimation. In the model, entrepreneurs have private and possibly error-ridden observations of persistent and transitory shocks to profit. We demonstrate that the model's parameters can be recovered from public observations of sales and survival, and we estimate them using monthly data from new bars in Texas. We find that entrepreneurs observe profit's persistent component without error. In this sense, their information is substantially superior to the public's.

Suggested Citation

Abbring, Jaap H. and Campbell, Jeffrey R., A Structural Empirical Model of Firm Growth, Learning, and Survival (May 2003). NBER Working Paper No. w9712, Available at SSRN: https://ssrn.com/abstract=408208

Jaap H. Abbring

Tilburg University - Department of Econometrics & Operations Research ( email )

Tilburg, 5000 LE
Netherlands

HOME PAGE: http://center.uvt.nl/staff/abbring/

Tilburg University - Center for Economic Research (CentER) ( email )

P.O. Box 90153
Tilburg, 5000 LE
Netherlands

HOME PAGE: http://center.uvt.nl/staff/abbring/

Tinbergen Institute

Roetersstraat 31
Amsterdam, 1018WB
Netherlands

HOME PAGE: http://www.tinbergen.nl

IZA Institute of Labor Economics

P.O. Box 7240
Bonn, D-53072
Germany

Jeffrey R. Campbell (Contact Author)

University of Notre Dame ( email )

United States

Tilburg University ( email )

Tilburg, 5000 LE
Netherlands

Do you have a job opening that you would like to promote on SSRN?

Paper statistics

Downloads
33
Abstract Views
1,146
PlumX Metrics