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Measuring Productivity Dispersion

Author

Listed:
  • Eric J. Bartelsman

    (VU Amsterdam, The Netherlands)

  • Zoltan Wolf

    (US Bureau of the Census, USA)

Abstract

Measuring the dispersion of productivity or efficiency across firms in a market or industry is rife with methodological issues. Nevertheless, the existence of considerable dispersion now is well documented and widely accepted. Less well understood are the economic features and mechanisms underlying the magnitude of dispersion and how dispersion varies over time or across markets. On the one hand, selection mechanisms in both output and input markets should favor the most productive units through resource reallocation, thereby reducing dispersion. On the other hand, innovation and technological uncertainty tend to increase dispersion. This chapter presents a guide to measurement of dispersion and provides empirical evidence from a selection of countries and industries using a variety of methodologies.

Suggested Citation

  • Eric J. Bartelsman & Zoltan Wolf, 2017. "Measuring Productivity Dispersion," Tinbergen Institute Discussion Papers 17-033/VI, Tinbergen Institute.
    • Handle: RePEc:tin:wpaper:20170033
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    References listed on IDEAS

    as
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    Cited by:

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    2. Bassier, Ihsaan, 2022. "Firms and inequality when unemployment is high," LSE Research Online Documents on Economics 117999, London School of Economics and Political Science, LSE Library.
    3. Corrado, Carol & Haskel, Jonathan & Jona-Lasinio, Cecilia, 2019. "Productivity growth, capital reallocation and the financial crisis: Evidence from Europe and the US," Journal of Macroeconomics, Elsevier, vol. 61(C), pages 1-1.
    4. Rawat, Pankaj S. & Sharma, Seema, 2021. "TFP growth, technical efficiency and catch-up dynamics: Evidence from Indian manufacturing," Economic Modelling, Elsevier, vol. 103(C).
    5. Bańbura, Marta & Albani, Maria & Ambrocio, Gene & Bursian, Dirk & Buss, Ginters & de Winter, Jasper & Gavura, Miroslav & Giordano, Claire & Júlio, Paulo & Le Roux, Julien & Lozej, Matija & Malthe-Thag, 2018. "Business investment in EU countries," Occasional Paper Series 215, European Central Bank.
    6. Girum Abebe & Tigabu Degu & Gebrehiwot Ageba, 2018. "What drives productivity change in the manufacturing sector? Evidence from the metalworking industry in Ethiopia," Working Papers 020, Policy Studies Institute.
    7. Bassier, Ihsaan, 2022. "Firms and inequality when unemployment is high," LSE Research Online Documents on Economics 121970, London School of Economics and Political Science, LSE Library.
    8. Ambrocio, Gene & Jokivuolle, Esa, 2017. "Should bank capital requirements be less risk-sensitive because of credit constraints?," Bank of Finland Research Discussion Papers 10/2017, Bank of Finland.
    9. Gonzales-Rocha, Erick & Mendez-Guerra, Carlos, 2018. "Increasing productivity dispersion: Evidence from light manufacturing in Brazil," MPRA Paper 88478, University Library of Munich, Germany.
    10. Gareth Anderson & Mr. Mehdi Raissi, 2018. "Corporate Indebtedness and Low Productivity Growth of Italian Firms," IMF Working Papers 2018/033, International Monetary Fund.
    11. Caroline Stiel & Alexander Schiersch, 2022. "Testing the superstar firm hypothesis," Journal of Applied Economics, Taylor & Francis Journals, vol. 25(1), pages 583-603, December.
    12. Ihsaan Bassier, 2022. "Firms and inequality when unemployment is high," CEP Discussion Papers dp1872, Centre for Economic Performance, LSE.
    13. Bassier, Ihsaan, 2023. "Firms and inequality when unemployment is high," Journal of Development Economics, Elsevier, vol. 161(C).
    14. Thomas von Brasch & Diana‐Cristina Iancu & Terje Skjerpen, 2020. "Productivity Dispersion and Measurement Error," Review of Income and Wealth, International Association for Research in Income and Wealth, vol. 66(4), pages 985-996, December.

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    More about this item

    Keywords

    Productivity; Firm-level data; dispersion; volatility;
    All these keywords.

    JEL classification:

    • D2 - Microeconomics - - Production and Organizations
    • O3 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights

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