The recording of technological capabilities through a comprehensive system of indicators is a central part of the annual report on the conditions of research, technology and innovation in Germany of the German Expertenkommission Forschung und Innovation (Expert Commission Research and Innovation (EFI)). The ZEW is involved in the development, measurement, and analysis of such indicators in the area of start-ups. The project on firm dynamics aims at capturing the start-up activities in the German knowledge economy (research and knowledge-intensive industries) and the development of the stock of enterprises, including the closure of enterprises, by means of indicators and to compare them over time and internationally. The indicators include birth and closure rates, firm churning, and the change in the stock of companies. It is also investigated how the legal and administrative framework for the establishment of companies in Germany and a number of European and non-European countries have developed since 2003. Data for Germany are taken from the Mannheim Enterprise Panel (MUP), data for other European countries come from the business demography statistics of Eurostat. For the analysis of the legal and administrative framework information from the Doing Business database of the Worldbank are used.In an additional analysis it will be examined how widespread acquisitions of innovative start-ups are among German companies. It will also be analysed in which sectors these acquisitions primarily occur. Again, the MUP will be used. This data base will be employed for identifying the fused companies since 2000. In order to mark innovative companies, information on patents from the Patstat database of the European Patent Office will be merged to the MUP.