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SBE 2020: Submission Detail

ID Number: 26
Title: Understanding the Huge Variation in Performance between Plants and Firms in Narrowly Defined Industries
Lead Author: Van Reenen, John
Abstract: This paper discusses some developments in economics that are Grand Challenges for the social sciences over the next 10-20 years. One recurrent theme is the importance of heterogeneity in performance between firms and how this links to management practices. One of the most profound facts uncovered about modern economies is the huge variation in performance between plants and firms in narrowly defined industries. For example, within a typical four digit sector in US manufacturing output per worker is four times as high for the plant at the 90th percentile as the plant at the 10th percentile. And for total factor productivity the difference is still about double. Even wider distributions are evident in other nations. The key challenge then is what is the cause of these between plant productivity differences?
PDF: VanReenen_John_26.pdf

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