Firm Dynamics and Productivity Growth: A Review of Micro Evidence from OECD Countries

OECD Economics Department Working Papers No. 297

66 Pages Posted: 28 Jul 2001

See all articles by Sanghoon Ahn

Sanghoon Ahn

Hitotsubashi University - Faculty of Economics

Date Written: June 7, 2001

Abstract

This paper surveys recent empirical studies exploring aggregate productivity growth based on firm dynamics, focusing on micro-data from OECD countries. Aggregate productivity growth can be analysed as a sum of two separate processes. i) Changes in productivity in individual firms at a given size (relative to market). And, ii) a reallocation process due to compositional effects arising from the expansion and contraction of existing firms as well as from entry and exit of firms (namely, firm dynamics). After reviewing theoretical explanations and empirical methods for firm dynamics and productivity growth, the paper looks into major findings from the manufacturing sector under three subsections: firm dynamics, productivity correlates, and productivity decomposition. The paper also reviews methodological issues and some findings from the emerging literature of empirical studies on the service sector.

Keywords: firm, productivity, micro-data, OECD

JEL Classification: D21, D24, O12, O30, O47

Suggested Citation

Ahn, Sanghoon, Firm Dynamics and Productivity Growth: A Review of Micro Evidence from OECD Countries (June 7, 2001). OECD Economics Department Working Papers No. 297. Available at SSRN: https://ssrn.com/abstract=276669 or http://dx.doi.org/10.2139/ssrn.276669

Sanghoon Ahn (Contact Author)

Hitotsubashi University - Faculty of Economics ( email )

Tokyo, 186-8601
Japan

Register to save articles to
your library

Register

Paper statistics

Downloads
1,193
Abstract Views
4,483
rank
16,630
PlumX Metrics