Product Switching and Firm Performance in Japan - Empirical Analysis Based on the Census of Manufacturers
AbstractFollowing Bernard, Redding and Schott (2010), we have constructed product and firm level data on Japanese manufacturing firms using the Census of Manufacturers. Our empirical analysis based on the constructed data shows that multiple-product firms perform better than single-product firms and their labor productivity growth rates are higher. Empirical studies at the industry level show that an unregulated, competitive environment stimulates product switching. At the firm level, product switching behavior improves firm performance, including employment, while the firms that reduce the number of their products see a decline in labor productivity, due to output reduction exceeding the magnitude of the reduction in employment.
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Bibliographic InfoArticle provided by Policy Research Institute, Ministry of Finance Japan in its journal Public Policy Review.
Volume (Year): 9 (2013)
Issue (Month): 2 (March)
Entry; Exit; Multiple-Product Firm; Product Switching; Labor Productivity; TFPCPropensity Score Matching Model;
Find related papers by JEL classification:
- L11 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - Production, Pricing, and Market Structure; Size Distribution of Firms
- L21 - Industrial Organization - - Firm Objectives, Organization, and Behavior - - - Business Objectives of the Firm
- L25 - Industrial Organization - - Firm Objectives, Organization, and Behavior - - - Firm Performance
- L60 - Industrial Organization - - Industry Studies: Manufacturing - - - General
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