Firm Dynamics and Growth Measurement in France

35 Pages Posted: 18 Apr 2018

See all articles by Philippe Aghion

Philippe Aghion

College de France and London School of Economics and Political Science, Fellow; Centre for Economic Policy Research (CEPR); National Bureau of Economic Research (NBER)

Antonin Bergeaud

Banque de France

Timo Boppart

Stockholm University - Institute for International Economic Studies (IIES); University of Zurich - Department of Economics

Simon Bunel

National Institute of Statistics and Economic Studies (INSEE)

Date Written: April 1, 2018

Abstract

Statistical agencies typically impute inflation for disappearing products based on surviving products, which may result in overstated inflation and understated growth. This paper uses the theory and methodology developed by Aghion et al. (2017) to quantify in the case of France how much of productivity growth is missed by statistical offices because of this. Using the census of plants in France, we find that from 2004 to 2015, about 0.5 percentage point of real output growth per year is not taken into account, which is about the same as what was found in the U.S. While this result suggests that missing growth from creative destruction could structurally be the same in different countries, we show that they in fact hide different underlying establishment and firm's lifecycle dynamics in the two countries.

Keywords: Growth, Price measurement, Firm dynamic, Lifecycle of plants

JEL Classification: O4

Suggested Citation

Aghion, Philippe and Bergeaud, Antonin and Boppart, Timo and Bunel, Simon, Firm Dynamics and Growth Measurement in France (April 1, 2018). Banque de France Working Paper No. 676. Available at SSRN: https://ssrn.com/abstract=3163531 or http://dx.doi.org/10.2139/ssrn.3163531

Philippe Aghion

College de France and London School of Economics and Political Science, Fellow ( email )

London
United Kingdom

Centre for Economic Policy Research (CEPR)

London
United Kingdom

National Bureau of Economic Research (NBER)

1050 Massachusetts Avenue
Cambridge, MA 02138
United States

Antonin Bergeaud (Contact Author)

Banque de France ( email )

Paris
France

Timo Boppart

Stockholm University - Institute for International Economic Studies (IIES) ( email )

Stockholm, SE-10691
Sweden

University of Zurich - Department of Economics ( email )

Z├╝rich, CH-8006
Switzerland

Simon Bunel

National Institute of Statistics and Economic Studies (INSEE) ( email )

18, Boulevard Adolphe-Pinard
92244 Malakoff Cedex
France

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