Entrepreneurship Working Group meeting.

• Position: Program and Working Group Meeting - National Bureau of Economic Research

The Entrepreneurship Working Group met in Cambridge on October 20. Group Director Josh Lerner, NBER and Harvard Business School, organized this program:

Steven J. Davis, NBER and University of Chicago; John Haltiwanger, NBER and University of Maryland; and Javier Miranda and Ron Jarmin, Bureau of the Census, "Volatility and Dispersion in Business Growth Rates: Publicly Traded versus Privately Held Firms" (NBER Working Paper No. 12354)

Discussant: Richard Caves, Harvard University

Suresh De Mel, University of Peradeniya; David McKenzie, The World Bank; and Chris Woodruff, University of California, San Diego, "Returns to Capital in Microenterprises: Evidence from a Field Experiment"

Discussant: Shawn Cole, Harvard University

Thomas Hellmann, University of British Columbia; Laura Bottazzi, Bologna University; and Marco Da Rin, Tilburg University, "The Importance of Trust for Investment: Evidence from Venture Capital"

Discussant: Rebecca Zarutskie, Duke University

Morten Sorensen, University of Chicago, "Learning by Investing: Evidence from Venture Capital"

Discussant: Dirk Bergernann, Yale University

Panel Discussion: "Where is the Venture Capital Going? And Does it Matter?" Paul Gompers, Harvard University and NBER; Bill Helrnan, Greylock Partners; and Philip Rotner, MIT

Yael Hochberg, Northwestern University; and Alexander Ljungvist and Yang Lu, New York University, "Networking as a Barrier to Entry and the Competitive Supply of Venture Capital"

Discussant: Toby Stuart, Harvard University

Davis and his co-authors study the variability of business growth rates in the U.S. private sector from 1976 onwards. They exploit the recently developed Longitudinal Business Database (LBD), which contains annual observations on employment and payroll for all U.S. businesses. Their central finding is a large secular decline in the cross-sectional dispersion of firm growth rates and in the average magnitude of firm-level volatility. Measured as in other recent research, the employment-weighted mean volatility of firm growth rates has declined by more than 40 percent since 1982. This stands in sharp contrast to previous findings of rising volatility for publicly traded firms in COMPUSTAT data. The researchers confirm the rise in volatility among publicly traded firms using the LBD, but show that its impact is overwhelmed by declining volatility among privately held firms. This pattern holds in every major industry group. Employment shifts toward older...