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An Empirical Model of Growth Through Product Innovation Author info | Abstract | Publisher info | Download info | Related research | Statistics Rasmus Lentz (University of Wisconsin-Madison)
Dale T. Mortensen (Northwestern University)
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Productivity dispersion across firms is large and persistent, and worker reallocation among firms is an important source of productivity growth. The purpose of the paper is to estimate the structure of an equilibrium model of growth through innovation that explains these facts. The model is a modified version of the Schumpeterian theory of firm evolution and growth developed by Klette and Kortum (2004). The data set is a panel of Danish firms than includes information on value added, employment, and wages. The model's fit is good and the structural parameter estimates have interesting implications for the aggregate growth rate and the contribution of worker reallocation to it.
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Paper provided by University of Copenhagen. Department of Economics. Centre for Applied Microeconometrics in its series CAM Working Papers with number
2005-13.
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Length: 39 pages
Date of creation: Jul 2005Date of revision:
Handle: RePEc:kud:kuieca:2005_13Contact details of provider: Postal: Øster Farimagsgade 5, Building 26, DK-1353 Copenhagen K., Denmark Phone: (45) 35 32 30 74 Fax: +45 35 32 30 00 Web page: http://www.econ.ku.dk/CAM/ More information through EDIRC
For technical questions regarding this item, or to correct its listing, contact: (Henriette Aabo Hansen).
Keywords: labor productivity growth ; worker reallocation ; firm dynamics ; firm panel data estimation ; Other versions of this item:
Paper Rasmus Lentz & Dale T. Mortensen, 2005.
"An Empirical Model of Growth Through Product Innovation ,"
Boston University - Department of Economics - Working Papers Series
WP2005-004, Boston University - Department of Economics.
[Downloadable!] Dale T. Mortensen & Rasmus Lentz, 2005.
"An Empirical Model of Growth Through Product Innovation ,"
2005 Meeting Papers
910, Society for Economic Dynamics.
[Downloadable!] Rasmus Lentz & Dale T. Mortensen, 2005.
"An Empirical Model of Growth Through Product Innovation ,"
NBER Working Papers
11546, National Bureau of Economic Research, Inc.
[Downloadable!] (restricted) Rasmus Lentz & Dale T. Mortensen, 2005.
"An Empirical Model of Growth Through Product Innovation ,"
IZA Discussion Papers
1685, Institute for the Study of Labor (IZA).
[Downloadable!] Find related papers by JEL classification: E22 - Macroeconomics and Monetary Economics - - Macroeconomics: Consumption, Saving, Production, Employment, and Investment - - - Capital; Investment; Capacity E24 - Macroeconomics and Monetary Economics - - Macroeconomics: Consumption, Saving, Production, Employment, and Investment - - - Employment; Unemployment; Wages; Intergenerational Income Distribution J23 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Labor Demand J24 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Human Capital; Skills; Occupational Choice; Labor Productivity L11 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - Production, Pricing, and Market Structure; Size Distribution of Firms L25 - Industrial Organization - - Firm Objectives, Organization, and Behavior - - - Firm Performance O3 - Economic Development, Technological Change, and Growth - - Technological Change
This paper has been announced in the following NEP Reports :
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.: Klette, Tor Jakob & Griliches, Zvi, 1996.
"The Inconsistency of Common Scale Estimators When Output Prices Are Unobserved and Endogenous ,"
Journal of Applied Econometrics ,
John Wiley & Sons, Ltd., vol. 11(4), pages 343-61, July-Aug..
[Downloadable!] (restricted)
Other versions:
Tor Jakob Klette & Zvi Griliches, 1996.
"The Inconsistency of Common Scale Estimators When Output Prices Are Unobserved and Engogenous ,"
NBER Working Papers
4026, National Bureau of Economic Research, Inc.
[Downloadable!] (restricted) Tor Jakob Klette and Zvi Griliches, 1994.
"The Inconsistency of Common Scales Estimators when Output Prices are Unobserved and Endogenous ,"
Discussion Papers
127, Research Department of Statistics Norway.
Klette, T.J., 1992.
"The Inconsistency of Common Scale Estimators when Output Prices are unobserved and Endogenous ,"
Harvard Institute of Economic Research Working Papers
1586, Harvard - Institute of Economic Research.
Javier Alvarez & Martin Browning & Mette Ejrnæs, 2001.
"Modelling Income Processes with lots of heterogeneity ,"
CAM Working Papers
2002-01, University of Copenhagen. Department of Economics. Centre for Applied Microeconometrics.
[Downloadable!]
Other versions:
Javier Alvarez & Martin Browning & Mette Ejrnæs, 2002.
"Modelling income processes with lots of heterogeneity ,"
10th International Conference on Panel Data, Berlin, July 5-6, 2002
D2-3, International Conferences on Panel Data.
[Downloadable!] Martin Browning & Mette Ejrnaes & Javaier Alvarez, 2006.
"Modelling income processes with lots of heterogeneity ,"
Economics Series Working Papers
285, University of Oxford, Department of Economics.
[Downloadable!] John Haltiwanger & C J Krizan & Lucia Foster, 1998.
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Working Papers
98-12, Center for Economic Studies, U.S. Census Bureau.
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Other versions: Gourieroux, C & Monfort, A & Renault, E, 1993.
"Indirect Inference ,"
Journal of Applied Econometrics ,
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Other versions: Martin Neil Baily & Eric J. Bartelsman & John Haltiwanger, 1994.
"Downsizing and Productivity Growth: Myth or Reality? ,"
NBER Working Papers
4741, National Bureau of Economic Research, Inc.
[Downloadable!] (restricted)
Other versions:
John Haltiwanger & Martin N Baily & Eric J Bartelsman, 1994.
"Downsizing and Productivity Growth: Myth or Reality? ,"
Working Papers
94-4, Center for Economic Studies, U.S. Census Bureau.
[Downloadable!] Martin N. Baily & Eric J. Bartelsman & John Haltiwanger, 1994.
"Downsizing and productivity growth: myth or reality? ,"
Finance and Economics Discussion Series
94-7, Board of Governors of the Federal Reserve System (U.S.).
Baily, Martin Neil & Bartelsman, Eric J & Haltiwanger, John, 1996.
" Downsizing and Productivity Growth: Myth or Reality? ,"
Small Business Economics ,
Springer, vol. 8(4), pages 259-78, August.
Eric J. Bartelsman & Mark Doms, 2000.
"Understanding Productivity: Lessons from Longitudinal Microdata ,"
Journal of Economic Literature ,
American Economic Association, vol. 38(3), pages 569-594, September.
[Downloadable!] (restricted)
Other versions: Anders Frederiksen & Niels Westergaard-Nielsen, 2002.
"Where did they go? ,"
10th International Conference on Panel Data, Berlin, July 5-6, 2002
D3-2, International Conferences on Panel Data.
[Downloadable!]
Other versions:
Frederiksen, Anders & Westergaard-Nielsen, Niels, 2002.
"Where Did They Go? ,"
IZA Discussion Papers
414, Institute for the Study of Labor (IZA).
[Downloadable!] Frederiksen, Anders & Westergaard-Nielsen, Niels, 2002.
"Where did they go ? ,"
CLS Working Papers
01-11, University of Aarhus, Aarhus School of Business, Centre for Labour Market and Social Research.
[Downloadable!] Altonji, Joseph G & Segal, Lewis M, 1996.
"Small-Sample Bias in GMM Estimation of Covariance Structures ,"
Journal of Business & Economic Statistics ,
American Statistical Association, vol. 14(3), pages 353-66, July.
Other versions: Tor Jakob Klette & Samuel Kortum, 2002.
"Innovating Firms and Aggregate Innovation ,"
NBER Working Papers
8819, National Bureau of Economic Research, Inc.
[Downloadable!] (restricted)
Other versions:
Klette, Tor Jakob & Kortum, Samuel S, 2002.
"Innovating Firms and Aggregate Innovation ,"
CEPR Discussion Papers
3248, C.E.P.R. Discussion Papers.
[Downloadable!] (restricted) Klette, Tor Jakob & Kortum, Samuel, 2002.
"Innovating Firms and Aggregate Innovation ,"
Memorandum
02/2002, Oslo University, Department of Economics.
[Downloadable!] Jakob Klette & Samuel Kortum, 2002.
"Innovating firms and aggregate innovation ,"
Staff Report
300, Federal Reserve Bank of Minneapolis.
[Downloadable!] Tor Jakob Klette & Samuel Kortum, 2004.
"Innovating Firms and Aggregate Innovation ,"
Journal of Political Economy ,
University of Chicago Press, vol. 112(5), pages 986-1018, October.
Joel L. Horowitz, 1996.
"Bootstrap Methods For Covariance Structures ,"
Econometrics
9610003, EconWPA.
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Steven J. Davis & John C. Haltiwanger & Scott Schuh, 1998.
"Job Creation and Destruction ,"
MIT Press Books ,
The MIT Press,
edition 1, volume 1, number 0262540932.
Rasmus Lentz & Dale T. Mortensen, 2005.
"Productivity Growth And Worker Reallocation ,"
International Economic Review ,
Department of Economics, University of Pennsylvania and Osaka University Institute of Social and Economic Research Association, vol. 46(3), pages 731-749, 08.
[Downloadable!] (restricted)
Esteban Rossi-Hansberg & Mark L.J. Wright, 2005.
"Firm Size Dynamics in the Aggregate Economy ,"
NBER Working Papers
11261, National Bureau of Economic Research, Inc.
[Downloadable!] (restricted)
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references 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.)
Erzo G.J. Luttmer, 2006.
"Consumer search and firm growth ,"
Working Papers
645, Federal Reserve Bank of Minneapolis.
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Tomi Kyyrä & mika Maliranta, 2006.
"The Micro-level Dynamics of Declining Labour Share: Lessons from Finnish Great Leap ,"
Discussion Papers
1049, The Research Institute of the Finnish Economy.
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Eric J. Bartelsman & Zoltán Wolf, 2009.
"Forecasting Productivity Using Information from Firm-Level Data ,"
Tinbergen Institute Discussion Papers
09-043/3, Tinbergen Institute.
[Downloadable!]
Laura Valkonen, 2006.
"Deregulation as a Means to Increase Competition and Productivity ,"
Discussion Papers
1014, The Research Institute of the Finnish Economy.
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Boyan Jovanovic, 2007.
"Investment Options and the Business Cycle ,"
NBER Working Papers
13307, National Bureau of Economic Research, Inc.
[Downloadable!] (restricted)
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