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Real-Life Case Study: Entry and Exit of Firms in Industry

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ENTRY AND EXIT OF FIRMS: WHERE HAVE THEY OCCURRED?

Go to the Census Bureau Web site at www.census.gov and select Economic Census, then Comparative Statistics, and then Manufacturing (More data). Identify three manufacturing industries that experienced large percentage increases in the number of firms between 1997 and 2002. Identify three manufacturing industries that experienced large percentage decreases. What single factor is the most likely cause of the entry and exit differences between your two groups? Explain.

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Solution Summary

This solution uses statistics from the U.S. Census Bureau to find manufacturing industries that experienced large increases or decreases in the number of firms between 1997 and 2002, and proposes the single factor that most likely explains the results.

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The relevant data is at http://www.census.gov/econ/census02/data/comparative/USCS_31.HTM
Three industries that experienced large increases in the number of firms (establishments) ...

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