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Be productive or face decline. On the sources and determinants of output growth in Italian manufacturing firms

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Author Info
Angelo Zago () (Corresponding author, Dipartimento di Scienze Economiche (Università di Verona))
Francesco Aiello ()
Camilla Mastromarco ()

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Abstract

This paper investigates the sources and determinants of output growth of Italian manufacturing firms. Applying stochastic frontier techniques, we decompose output growth into factor accumulation and TFP growth from 1998 to 2003. TFP growth is further decomposed into technological change, efficiency change, and scale effects. We find that both input accumulation and TFP growth are important in explaining output growth. In addition, efficiency change (technological catch-up) is the most significant component of TFP growth. Finally, using a specific formulation of the asymmetric error component, we find that R&D spillovers, banking efficiency and public infrastructures have statistically significant and economically relevant effects on the technological catch-up.

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Paper provided by Università di Verona, Dipartimento di Scienze economiche in its series Working Papers with number 46.

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Length: 35
Date of creation: Mar 2008
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Handle: RePEc:ver:wpaper:46

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Related research
Keywords: growth accounting; stochastic frontiers; TFP; R&D spillovers; banking efficiency; infrastructure; Italian manufacturing firms.;

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Find related papers by JEL classification:
O47 - Economic Development, Technological Change, and Growth - - Economic Growth and Aggregate Productivity - - - Measurement of Economic Growth; Aggregate Productivity; Cross-Country Output Convergence
C23 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Models with Panel Data
G21 - Financial Economics - - Financial Institutions and Services - - - Banks; Other Depository Institutions; Mortgages
H54 - Public Economics - - National Government Expenditures and Related Policies - - - Infrastructures

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