The Micro-Level Dynamics of Regional Productivity Growth: The Source of Divergence in Finland

Posted: 6 Feb 2007

See all articles by Petri Bockerman

Petri Bockerman

Labour Institute for Economic Research; University of Turku - Turku School of Economics

Mika Maliranta

ETLA, The Research Institute of the Finnish Economy

Abstract

Despite a rapidly expanding theoretical and empirical literature emphasising the role of incessant intra-industry restructuring in productivity growth, few studies have gone beyond the framework of the representative firm in examining convergence or divergence in regional productivity. We use unique longitudinal plant-level data over a long period of time and apply a useful variant of productivity decomposition methods to study differences in productivity-enhancing restructuring within manufacturing industries among Finnish regions. Long-lasting differences in industry productivity growth between Southern and Eastern Finland can be attributed to the "creative destruction" components of productivity growth, mainly to the between and entry components.

Keywords: Productivity, Efficiency, Micro-level restructuring, Convergence, Divergence

JEL Classification: O12, R11

Suggested Citation

Bockerman, Petri and Maliranta, Mika, The Micro-Level Dynamics of Regional Productivity Growth: The Source of Divergence in Finland. Regional Science and Urban Economics, Vol. 37, No. 2, pp. 165-182, 2007, Available at SSRN: https://ssrn.com/abstract=961248

Petri Bockerman

Labour Institute for Economic Research ( email )

FIN-00530 Helsinki
Finland
+358 9 2535 7332 (Phone)
+358 9 2535 7332 (Fax)

HOME PAGE: http://www.petribockerman.fi/

University of Turku - Turku School of Economics ( email )

Rehtorinpellonkatu 3
TURKU, FI-20500
Finland

Mika Maliranta (Contact Author)

ETLA, The Research Institute of the Finnish Economy ( email )

Lonnrotink. 4 B
FIN-00120 Helsinki, 00120
Finland
+358 9 609900 (Phone)
+358 9 601753 (Fax)

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