2010/03 | LEM Working Paper Series | |
Turbulence underneath the big calm? Exploring the micro-evidence behind the flat trend of manufacturing productivity in Italy |
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Giovanni Dosi, Marco Grazzi, Chiara Tomasi, Alessandro Zeli |
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Keywords | ||
productivity; firm dynamics; market selection; trade; euro shock; quantile regressions.
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JEL Classifications | ||
C14, D20, F10, L10, L16, L25
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Abstract | ||
Italy ranked last in terms of manufacturing productivity growth
according to OECD estimates over the last decade with a flat, if not
declining, trend. In this work we investigate the underlying
firm-level dynamics of enterprises on the grounds of a database
developed by the Italian Statistical Office (ISTAT) covering the
period 1989-2004 and containing information on more than 100,000
firms. Over the period not only the indicators of central tendency of
the distribution of labour productivities have not significantly
changed, but also the whole sectoral distributions have remained
relatively stable over time, with their support at least not shrinking
or even possibly widening over time. This is even more surprising if
one takes into consideration the 'Euro' shock that occurred during
the period of investigation. On the contrary we observe that
inter-decile differences in productivity have been increasing.
Further, heterogeneous firms' characteristics (i.e. export activity
and innovativeness) appear to have contributed to boost such
intra-industry differences. Given such wide heterogeneities we resort
to quantile regressions to identify the impact of a set of regressors
at different levels of the conditional distribution of labor
productivity. One phenomenon that we observe is what we call a
tendency toward 'neo-dualism' involving the co-existence of a small
group of dynamic firms with a bigger ensemble of much less
technologically progressive ones.
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