CELSA-Collaborativeresearchproject-Applicationform-COVERPAGE
1. Identificationoftheprincipalinvestigator–co-ordinator
Fullname:Prof.Dr.JozefKonings
Faculty/Department:FacultyofEconomicsandBusiness
ResearchunitwithinFaculty/Department:VIVES
Address:Waaistraat6–bus3550,3000,Leuven,Belgium
University:KULeuven
Tel:+3216326820
Fax:+3216373511
email:[email protected]
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Signature :
2. Identificationofthesecondinvestigator
Fullname:Prof.Dr.JozeDamijan
Faculty/Department:FacultyofEconomics
ResearchunitwithinFaculty/Department:AcademicUnitforInternationalEconomicsandBusiness
Address:Kardeljevaploscad17,1000Ljubljana,Slovenia
University:LjubljanaUniversity
Tel:+38615892-763
Fax:
email:[email protected]
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Signature :
3. Identificationofthirdandfourthco-investigator(s)(ifapplicable)
Expandtableifmorethanfourresearchunitsareinvolved.
Thirdco-investigator
Fourthco-investigator
Fullname:Prof.Dr.PatrickVanCayseele
Fullname:Porf.Dr;CrtKostevc
Faculty/Department: Faculty of Economics and Faculty/Department:FacultyofEconomics
Business
Research unit within
DepartmentofEconomics
Faculty/Department: Research unit within Faculty/Department: Academic Unit
forInternationalEconomicsandBusiness
Address:Naamsestraat69-bus3565,3000Leuven, Address:Kardeljevaploscad17,1000Ljubljana,Slovenia
Belgium
University:KULeuven
University:LjubljanaUniversity
Tel:+3216326830
Tel:+38615892-643
Fax:+3216326796
email:[email protected]
Fax:
email:[email protected]
Signature1:
Signature :
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Faxedsignatureswillbeaccepted.
3.Nonconfidentialandpublicfriendlysummary(max.2000characters)
Project title: Firm-level hubs and impact of granularity on the propagation of shocks and aggregate output
fluctuationsinasmallopeneconomy
Summary: In modern economics it is believed that individual firms have a negligible impact on the macro
economy as shocks to individual firms will average out. Recent research however shows a highly skewed
distributionoffirmswithregardtosize:20%offirmsaccountfor80%oftotalsales,employmentandexports.In
small countries this ratio is closer to 10:90. Using complete company-level data for two small economies,
Belgium and Slovenia, our research aims to demonstrate that some large firms do in fact have a
disproportionately large effect on the regional and national economy. It will illuminate the networks of firms
thatenablethefunctioningofthenationaleconomyandexposethe“hub”enterprisesattheircenterandtheir
coordinatingroles.Duringeconomicdownturnsthishighconcentrationofoutputandemploymentinjustafew
regional hubs of economic activity can have a potentially big impact, propagated through a network of
up(down) stream suppliers. Such extremely skewed distributions may justify government intervention when
thingsgoawkwardforsuperstarcompaniesthatare“toobigtofail”.Ourresearchwillenablepolicymakersto
gain insight into the regional structure of the economy. Also, it will provide new tools for identifying and
monitoring the economic activity in big networks of companies. Ultimately, the project aims to deliver policy
suggestionswhileshowcasingthepotentialofhubfirmstogeneratestrongpositiveornegativerippleeffects
acrosstheirspheresofinfluence.
4. List5keywords
Granularity,firmsizedistribution,hubfirms,transmissionofoutputshocks,coordinatedpricechanges