Working Paper

Selection, Firm Turnover, and Productivity Growth : Do Emerging Cities Speed Up the Process?

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collection.link.5
https://openknowledge.worldbank.org/handle/10986/9
collection.name.5
Policy Research Working Papers
dc.contributor.author
Jones, Patricia
dc.contributor.author
Mengistae, Taye
dc.contributor.author
Zeufack, Albert
dc.date.accessioned
2018-01-05T16:36:07Z
dc.date.available
2018-01-05T16:36:07Z
dc.date.issued
2018-01
dc.date.lastModified
2021-06-08T14:42:48Z
dc.description.abstract
This paper identifies and estimates the impact of firm entry and exit on plant-level productivity in Ethiopia as part of a selection mechanism that might be driving aggregate productivity growth in cities. Specifically, the paper investigates how firms’ entry and exit contribute to the pace of factor reallocation and total factor productivity growth within industries—and whether these processes occur in higher numbers and rates in larger cities. The analysis is carried out using establishment census data from Ethiopia that cover the period from year 2000 to 2010. Importantly, these data include information on plants’ physical outputs and their prices, which allows distinguishing between revenue-based measures of total factor productivity (TFPR) and those based on physical productivity (TFPQ). The analysis reveals that these two measures generate very different results under imperfect competition, suggesting that physical productivity measures (TFPQ) are better suited to examining firm dynamics when local producers have some degree of market power. In addition, the findings show that less productive (higher cost) firms are more likely to exit than their more productive (lower cost) rivals—but the analysis controls for producers’ transport costs. This is consistent with the probability of firm exit being higher when transport costs are lower.
en
dc.identifier
http://documents.worldbank.org/curated/en/613111514905269837/Selection-firm-turnover-and-productivity-growth-do-emerging-cities-speed-up-the-process
dc.identifier.uri
http://hdl.handle.net/10986/29126
dc.language
English
dc.publisher
World Bank, Washington, DC
dc.relation.ispartofseries
Policy Research Working Paper;No. 8291
dc.rights
CC BY 3.0 IGO
dc.rights.holder
World Bank
dc.rights.uri
http://creativecommons.org/licenses/by/3.0/igo
dc.subject
PRODUCTIVITY
dc.subject
MARKET STRUCTURE
dc.subject
URBANIZATION
dc.subject
GEOSPATIAL ECONOMICS
dc.title
Selection, Firm Turnover, and Productivity Growth
en
dc.title.subtitle
Do Emerging Cities Speed Up the Process?
en
dc.type
Working Paper
en
okr.crossref.title
Selection, Firm Turnover, and Productivity Growth: Do Emerging Cities Speed up the Process?
okr.date.disclosure
2018-01-02
okr.doctype
Publications & Research :: Policy Research Working Paper
okr.doctype
Publications & Research
okr.docurl
http://documents.worldbank.org/curated/en/613111514905269837/Selection-firm-turnover-and-productivity-growth-do-emerging-cities-speed-up-the-process
okr.googlescholar.linkpresent
yes
okr.identifier.doi
10.1596/1813-9450-8291
okr.identifier.externaldocumentum
090224b0854dbed1_1_0
okr.identifier.internaldocumentum
29326497
okr.identifier.report
WPS8291
okr.imported
true
en
okr.language.supported
en
okr.pdfurl
http://documents.worldbank.org/curated/en/613111514905269837/pdf/WPS8291.pdf
en
okr.region.administrative
Africa
okr.region.country
Ethiopia
okr.statistics.dr
613111514905269837
okr.topic
Industry :: Industrial Economics
okr.topic
Macroeconomics and Economic Growth :: Economic Theory & Research
okr.topic
Macroeconomics and Economic Growth :: Spatial and Local Economic Development
okr.topic
Urban Development :: Urban Economics
okr.unit
Finance, Competitiveness and Innovation Global Practice; and Africa Region

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