What Determines Productivity?
Journal of Economic Literature
vol. 49,
no. 2, June 2011
(pp. 326-65)
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)Citation
Syverson, Chad. 2011. "What Determines Productivity?" Journal of Economic Literature, 49 (2): 326-65. DOI: 10.1257/jel.49.2.326JEL Classification
- D24 Production; Cost; Capital, Total Factor, and Multifactor Productivity; Capacity
- G31 Capital Budgeting; Fixed Investment and Inventory Studies; Capacity
- L11 Production, Pricing, and Market Structure; Size Distribution of Firms
- M10 Business Administration: General
- O30 Technological Change; Research and Development: General
- O47 Measurement of Economic Growth; Aggregate Productivity; Cross-Country Output Convergence