Transcription of What Determines Productivity?
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What Determines Productivity?
Journal of Economic Literature 2011, 49:2, 326 365. What Determines productivity ? Chad Syverson*. Economists have shown that large and persistent differences in productivity levels across businesses are ubiquitous. This finding has shaped research agendas in a num- ber of fields, including (but not limited to) macroeconomics, industrial organization, labor, and trade. This paper surveys and evaluates recent empirical work address- ing the question of why businesses differ in their measured productivity levels. The causes are manifold, and differ depending on the particular setting. They include ele- ments sourced in production practices and therefore over which producers have some direct control, at least in theory as well as from producers' external operat- ing 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.
Perhaps in no other field have the produc-tivity dispersion patterns noted above had a greater influence on the trajectory of the research agenda than in the trade literature. Theoretical frameworks using heterogeneous-productivity firms like Jonathan Eaton and Samuel Kortum (2002) and Marc J. Melitz (2003) are now the dominant conceptual
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