Abstract: Survival of New Firms in an Industry Agglomeration: An Empirical Analysis Using Tokyo Telephone Directories from the 1980s
My purpose in this essay is to examine the impact of industry agglomeration on the survival of new firms, using a unique dataset from Tokyo business telephone directories in the 1980s. I focus on the largest agglomeration of the metal and machinery industries in Japan, Ota Ward in Tokyo, at its peak. I found 1,603 start-up firms in the manufacturing sector in Ota in three cohorts in the first half of the 1980s, checked their survival five years later, and econometrically analyzed the influence of industry agglomeration on their survival. The empirical results suggest the positive and significant effects of industry agglomeration on start-up firms' chance of survival, but only for the sub-sample of joint-stock companies.