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Micro Efficiency and Aggregate Growth in Chile

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  • Raphael Bergoeing
  • Andrea Repetto

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Abstract

Using plant-level data on Chilean manufacturing firms for the 1980-2001 period, we estimate and characterize disaggregate total factor productivity. We use these estimates to study the microeconomic sources of aggregate efficiency, a fundamental part of aggregate growth. By decomposing productivity dynamics into production reallocation and within plant efficiency changes, we find that reallocation accounted for almost all of total efficiency gains in Chile during the past few decades. The entry of new, more productive units explains most of these reallocation gains. Within-plant productivity growth contributes positively only during the 1990s, due perhaps to a lag between the implementation of major market oriented structural reforms -- mostly undertaken during the late 1970s and early 1980s -- and their complete effect on the economy. Our findings suggest that once reforms were consolidated, unbounded within-plant efficiency gains driven by technology adoption and innovation occurred.

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Bibliographic Info

Paper provided by Centro de Economía Aplicada, Universidad de Chile in its series Documentos de Trabajo with number 218.

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Date of creation: 2006
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Handle: RePEc:edj:ceauch:218

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Cited by:
  1. Andrea Repetto & Alejandro Micco, 2012. "Productivity, Misallocation and the Labor Market," Working Papers wp_020, Adolfo Ibáñez University, School of Government.
  2. Klaus Schmidt-Hebbel, 2006. "Chile's Economic Growth," Latin American Journal of Economics-formerly Cuadernos de Economía, Instituto de Economía. Pontificia Universidad Católica de Chile., vol. 43(127), pages 5-48.
  3. Fernandes, Ana M. & Paunov, Caroline, 2008. "Foreign direct investment in services and manufacturing productivity growth: evidence for Chile," Policy Research Working Paper Series 4730, The World Bank.
  4. Almeida, Rita & Fernandes, Ana M., 2011. "Explaining local manufacturing growth in Chile : the advantages of sectoral diversity," Policy Research Working Paper Series 5891, The World Bank.
  5. Bárbara Flores & Óscar Landerretche & Gabriela Sánchez, 2011. "Propensión al emprendimiento: ¿Los emprendedores nacen, se educan o se hacen?," Working Papers wp330, University of Chile, Department of Economics.
  6. Lucas Navarro & Raimundo Soto, 2006. "Procyclical Productivity in Manufacturing," Latin American Journal of Economics-formerly Cuadernos de Economía, Instituto de Economía. Pontificia Universidad Católica de Chile., vol. 43(127), pages 193-220.

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