Small Business Economics

, Volume 26, Issue 1, pp 39–60 | Cite as

Sectoral Differences in Plant Start-up Size in the Finnish Economy



New knowledge on the factors behind the choice of plant entry scale is important for understanding the entry process and the recruitment decisions of new plants in different sectors of the economy. The purpose of this paper is to evaluate the effect of various industry attributes on plant start-up size, measured with employment, using data on the entire Finnish business sector. The paper extends previous research by examining the differences between manufacturing and services and by using a richer set of explanatory variables. The relative importance of the covariates for different-sized entrants is taken into account by using a quantile regression approach. The results for manufacturing and services are remarkably similar. However, the findings imply that in the future analysis it is also important to consider the effect of the regional availability of educated and experienced work force on plant start-up size in these two sectors. The findings on the importance of scale economies and industry turbulence in determining start-up size correspond to the earlier studies. The results also show that single plant and multiplant entrants face a rather different entry environment. In addition, the employment share of foreign-owned entrants in the industry has to be taken into account.


entry industry differences quantile regression start-up size 

Jel Code

J21 J23 L11 L25 


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Copyright information

© Springer 2006

Authors and Affiliations

  1. 1.Statistics FinlandStatistics FinlandFinland

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