Footnote:
In: Forthcoming at American Economic Review
Nach Informationen von SSRN wurde die ursprüngliche Fassung des Dokuments February 2019 erstellt
Description:
Using confidential establishment-level data from the U.S. Census Bureau's Longitudinal Business Database, this paper documents how local shocks propagate across U.S. regions through firms' internal networks of establishments. Consistent with a model of optimal within-firm resource allocation, we find that establishment-level employment is sensitive to shocks in distant regions in which the establishment's parent firm is operating, and that the elasticity with respect to such shocks increases with the firm's financial constraint. At the aggregate regional level, we find that aggregate county-level employment is sensitive to shocks in distant counties linked through firms' internal networks