What Determines Productivity?

Abstract

Economists have shown that large and persistent differences in productivity levels across businesses are ubiquitous. This finding has shaped research agendas in a number of fields, including (but not limited to) macroeconomics, industrial organization, labor, and trade. This paper surveys and evaluates recent empirical work addressing the question of why businesses differ in their measured productivity levels. The causes are manifold, and differ depending on the particular setting. They include elements sourced in production practices -- and therefore over which producers have some direct control, at least in theory -- as well as from producers' external operating environments. After evaluating the current state of knowledge, I lay out what I see are the major questions that research in the area should address going forward. (JEL D24, G31, L11, M10, O30, O47)

Good Night, and Good Luck: Perspectives on Luck in Management Scholarship

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Technology and costs in international competitiveness: From countries and sectors to firms

“…Firms, irrespectively of the levels of disaggregation in terms of production activities, are highly heterogeneous on whatever measure chosen, both on the input and output sides, their efficiencies, degrees of innovativeness, market performances, even in presence of the same input prices (see, within an expanding literature, from Hildenbrand, 1981and Nelson, 1981to Bartelsman and Doms, 2000Dosi and Grazzi, 2006;Dosi, 2007;Dosi and Nelson, 2010;Syverson, 2011). Hence, any "representative agent" hypothesis, in our view, is sufficiently discredited not to deserve serious discussion.…”

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