Dutch retail trade on the rise? Relation between competition, innovation and productivity
AbstractThe Dutch retail trade demonstrated a relatively meagre performance in terms of productivity (growth) during the 1990s, especially seen from an international perspective. This study analyses the productivity performance of the Dutch retail trade in more detail, and focuses on competition and innovation as two main drivers of productivity growth. More precisely, it takes the mutual relationship between competition, innovation and productivity explicitly into account. Between 1993 and 2002 changes in competition varied substantially within the retail trade. However, on average competition slightly declined. Furthermore, only a few firms in the Dutch retail trade innovate. Regression analysis reveals that both competition and innovation enhance productivity growth directly. Further, fiercer competition induces more innovation, and consequently also raises productivity indirectly via innovation.
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Bibliographic InfoPaper provided by CPB Netherlands Bureau for Economic Policy Analysis in its series CPB Document with number 137.
Date of creation: Dec 2006
Date of revision:
Find related papers by JEL classification:
- D24 - Microeconomics - - Production and Organizations - - - Production; Cost; Capital; Capital, Total Factor, and Multifactor Productivity; Capacity
- L1 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance
- L5 - Industrial Organization - - Regulation and Industrial Policy
- L81 - Industrial Organization - - Industry Studies: Services - - - Retail and Wholesale Trade; e-Commerce
- O31 - Economic Development, Technological Change, and Growth - - Technological Change; Research and Development; Intellectual Property Rights - - - Innovation and Invention: Processes and Incentives
This paper has been announced in the following NEP Reports:
- NEP-ALL-2007-01-23 (All new papers)
- NEP-EFF-2007-01-23 (Efficiency & Productivity)
- NEP-INO-2007-01-23 (Innovation)
- NEP-INT-2007-01-23 (International Trade)
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