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Technology Within and Across Firms

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  • Cirera,Xavier
  • Comin,Diego Adolfo
  • Vargas Da Cruz,Marcio Jose
  • Lee,Kyungmin

Abstract

This study collects data on the sophistication of technologies used at the business function level for a representative sample of firms in Vietnam, Senegal, and the Brazilian state of Ceara. The analysis finds a large variance in technology sophistication across the business functions of a firm. The within-firm variance in technology sophistication is greater than the variance in sophistication across firms, which in turn is greater than the variance in sophistication across regions or countries. The paper documents a stable cross-firm relationship between technology at the business function and firm levels, which it calls the technology curve. Significant heterogeneity is uncovered in the slopes of the technology curves across business functions, a finding that is consistent with non-homotheticities in firm-level technology aggregators. Firm productivity is positively associated with the within-firm variance and the average level of technology sophistication. Development accounting exercises show that cross-firm variation in technology accounts for one-third of cross-firm differences in productivity and one-fifth of the agricultural versus non-agricultural gap in cross-country differences in firm productivity.

Suggested Citation

  • Cirera,Xavier & Comin,Diego Adolfo & Vargas Da Cruz,Marcio Jose & Lee,Kyungmin, 2020. "Technology Within and Across Firms," Policy Research Working Paper Series 9476, The World Bank.
    • Handle: RePEc:wbk:wbrwps:9476
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    References listed on IDEAS

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    Cited by:

    1. Ahmed Waqar Qasim, 2023. "Firms and Technology Adoption: The Role of Political Institutions and Market Size (Article)," The Pakistan Development Review, Pakistan Institute of Development Economics, vol. 62(1), pages 61-85.
    2. Cirera,Xavier & Vargas Da Cruz,Marcio Jose & Grover,Arti Goswami & Iacovone,Leonardo & Medvedev,Denis & Pereira Lopez,Mariana De La Paz & Reyes,Santiago, 2021. "Firm Recovery during COVID-19 : Six Stylized Facts," Policy Research Working Paper Series 9810, The World Bank.
    3. Cirera,Xavier & Comin,Diego Adolfo & Vargas Da Cruz,Marcio Jose & Lee,Kyungmin, 2021. "Firm-Level Adoption of Technologies in Senegal," Policy Research Working Paper Series 9657, The World Bank.

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