Older and slower: The startup deficit's lasting effects on aggregate productivity growth
Published
Journal Article
© 2017 Elsevier B.V. Declining firm entry and the aging incumbent firms have meaningful implications for sluggish U.S. aggregate productivity growth. We provide a framework to characterize the contributions to industry productivity growth across the firm age distribution then apply it to firm-level Census data. Several findings emerge: the relationship between firm age and productivity growth is downward sloping and convex; the magnitudes are substantial but fade quickly; selection and reallocation predominantly drive higher productivity growth of young firms. Our results suggest a cumulative drag on aggregate productivity of 3.1% since 1980 and are expanded upon with an IV strategy and standard model of firm dynamics.
Full Text
Duke Authors
Cited Authors
- Alon, T; Berger, D; Dent, R; Pugsley, B
Published Date
- January 1, 2018
Published In
Volume / Issue
- 93 /
Start / End Page
- 68 - 85
International Standard Serial Number (ISSN)
- 0304-3932
Digital Object Identifier (DOI)
- 10.1016/j.jmoneco.2017.10.004
Citation Source
- Scopus