Firm renewal in the regional economy

Abstract: This thesis consists four independent papers. In each paper the purpose is to analyse firm renewal, with special consideration to regional characteristics. Highlighted here are the knowledge available in the region where a firm is located as well as the local supply of financial intermediaries.The first paper analyses how the interaction of firms’ internal and external knowledge, in terms of knowledge intensive business services (KIBS), is related to the intensive and extensive margins of export flows. The second paper can be considered a continuation of the first, as the focus is solely on the export of new products. Also here, the interaction of internal and external knowledge is the main focus, analysed through education types. The results of these papers suggest that the regional contexts are indeed relevant for firm renewal, as firms that benefit from being located in areas with high external knowledge already have high internal knowledge.The third paper shifts focus to the innovation process itself by analysing how the access to the local supply of banks is related to firms’ perceived obstacles for innovation activities. The results indicate that lower access to banks increases the probability to experience problems obtaining external capital, which could be detrimental for firms’ renewal possibilities in the long run. The fourth paper focus on the creation of firms and analyses whether individuals are more or less likely to be self-employed after having children in a context where an extensive welfare system exists. The results show that individuals are less likely to be self-employed after having children than before, thus lowering the rate of firm renewal in the economy.