Plant-level data from U.S. textile industries indicate (1) significant cross-sectional dispersion in plant-level productivity within narrowly defined industries, (2) that highly productive plants grow faster and are less likely to exit, (3) dispersion in productivity is larger in industries with more rapid productivity growth, (4) older plants are bigger, and (5) plant births and closures are common to all four-digit textile industries. This paper presents an extended vintage model to explain these facts. The model assumes that a plant incurs a fixed cost of adopting the current best practice and convex costs of adjusting its capital stock. The model provides alternative explanations for the phenomena of investment spikes and S-shaped diffusion. Finally, the model interprets the fact that entry and exit are positively correlated across industries as evidence that variation in plant turnover across industries is driven by variation in technology rather than variation in demand growth. (Copyright: Elsevier)
Download Info
To download:
If you experience problems downloading a file, check if you have the
proper application to
view it first. Information about this may be contained
in the File-Format links below. In case of further problems read
the IDEAS help
file. Note that these files are not on the IDEAS
site. Please be patient as the files may be large.
As the access to this document is restricted, you may want to look for a different version under "Related research" (further below) or search for a different version of it.
Publisher Info
Article provided by Elsevier for the Society for Economic Dynamics in its journal Review of Economic Dynamics.
Find related papers by JEL classification: L6 - Industrial Organization - - Industry Studies: Manufacturing O3 - Economic Development, Technological Change, and Growth - - Technological Change O4 - Economic Development, Technological Change, and Growth - - Economic Growth and Aggregate Productivity
References listed on IDEAS Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
Ricardo J. Caballero, 1997.
"Aggregate Investment,"
NBER Working Papers
6264, National Bureau of Economic Research, Inc.
[Downloadable!] (restricted)
Other versions:
Dwyer, Douglas W., 1997.
"Are Fixed Effects Fixed?,"
Working Papers
97-35, C.V. Starr Center for Applied Economics, New York University.
[Downloadable!]
Cooley, Thomas F. & Greenwood, Jeremy & Yorukoglu, Mehmet, 1997.
"The replacement problem,"
Journal of Monetary Economics,
Elsevier, vol. 40(3), pages 457-499, December.
[Downloadable!] (restricted)
Other versions:
Thomas F. Cooley & Jeremy Greenwood & Mehmet Yorukoglu, 1994.
"The Replacement Problem,"
Working Papers
9408, Centro de Investigacion Economica, ITAM.
Cited by: (explanations, Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.)
Jeremy Greenwood & Boyan Jovanovic, 2000.
"Accounting for Growth,"
RCER Working Papers
475, University of Rochester - Center for Economic Research (RCER).
[Downloadable!]
Other versions:
Jeremy Greenwood & Boyan Jovanovic, 1998.
"Accounting for Growth,"
NBER Working Papers
6647, National Bureau of Economic Research, Inc.
[Downloadable!] (restricted)
Jeremy Greenwood & Boyan Jovanovic, 2001.
"Accounting for Growth,"
NBER Chapters,
in: New Developments in Productivity Analysis, pages 179-224
National Bureau of Economic Research, Inc.
[Downloadable!]