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Are small or large producers driving the Canada‐U.S. labour productivity gap? Recent evidence from manufacturing

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  • Jianmin Tang

Abstract

This paper shows that the higher small‐plant employment share in Canada compared with the United States mattered for the Canada‐U.S. manufacturing labour‐productivity gap, but it did not contribute to the widening of the gap between 2002 and 2007. In addition, it shows that while the weaker productivity performance of small plants in Canada compared with the United States accounted for much of the gap in a particular year, the deterioration in the productivity performance of large plants in Canada was responsible for most of the widening gap over this period. Est‐ce que les petits ou les grands producteurs conforment l’écart de productivité du travail entre le Canada et les États‐Unis? Résultats récents pour le secteur manufacturier. Ce texte montre que la plus grande portion de l'emploi dans les petits établissements au Canada par rapport aux États‐Unis est importante dans l'explication de la différence de niveau de productivité du travail entre le Canada et les États‐Unis, mais que ce facteur n'a pas contribué à l'accroissement de l'écart entre 2002 et 2007. De plus on montre qu'alors que la productivité plus faible des petits établissements au Canada par rapport aux États‐Unis explique le gros de l'écart pour une année particulière, c'est la détérioration de la productivité des grands établissements au Canada qui explique le gros de la croissance de l'écart au cours de cette période.

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  • Jianmin Tang, 2014. "Are small or large producers driving the Canada‐U.S. labour productivity gap? Recent evidence from manufacturing," Canadian Journal of Economics/Revue canadienne d'économique, John Wiley & Sons, vol. 47(2), pages 517-539, May.
  • Handle: RePEc:wly:canjec:v:47:y:2014:i:2:p:517-539
    DOI: 10.1111/caje.12080
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    References listed on IDEAS

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    1. Jianmin Tang & Weimin Wang, 2004. "Sources of aggregate labour productivity growth in Canada and the United States," Canadian Journal of Economics/Revue canadienne d'économique, John Wiley & Sons, vol. 37(2), pages 421-444, May.
    2. Paul Boothe & Richard Roy, 2008. "Business Sector Productivity in Canada: What Do We Know?," International Productivity Monitor, Centre for the Study of Living Standards, vol. 16, pages 3-13, Spring.
    3. John Baldwin & Beiling Yan, 2012. "Market Expansion and Productivity Growth: Do New Domestic Markets Matter as Much as New International Markets?," Journal of Economics & Management Strategy, Wiley Blackwell, vol. 21(2), pages 469-491, June.
    4. Chad Syverson, 2011. "What Determines Productivity?," Journal of Economic Literature, American Economic Association, vol. 49(2), pages 326-365, June.
    5. Chang-Tai Hsieh & Peter J. Klenow, 2009. "Misallocation and Manufacturing TFP in China and India," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 124(4), pages 1403-1448.
    6. Diego Restuccia & Richard Rogerson, 2008. "Policy Distortions and Aggregate Productivity with Heterogeneous Plants," Review of Economic Dynamics, Elsevier for the Society for Economic Dynamics, vol. 11(4), pages 707-720, October.
    7. Crucini, Mario J. & Shintani, Mototsugu, 2008. "Persistence in law of one price deviations: Evidence from micro-data," Journal of Monetary Economics, Elsevier, vol. 55(3), pages 629-644, April.
    8. John R. Baldwin & Ron S. Jarmin & Jianmin Tang, 2004. "Small North American Producers Give Ground in the 1990s," Small Business Economics, Springer, vol. 23(4), pages 349-361, November.
    9. John Baldwin & Beiling Yan, 2012. "Market Expansion and Productivity Growth: Do New Domestic Markets Matter as Much as New International Markets?," Journal of Economics & Management Strategy, Wiley Blackwell, vol. 21(2), pages 469-491, June.
    10. Danny Leung & Césaire Meh & Yaz Terajima, 2008. "Firm Size and Productivity," Staff Working Papers 08-45, Bank of Canada.
    11. Robert E. Lucas Jr., 1978. "On the Size Distribution of Business Firms," Bell Journal of Economics, The RAND Corporation, vol. 9(2), pages 508-523, Autumn.
    12. Kelvin Ka Yin Chan & Wulong Gu & Jianmin Tang, 2012. "Industry Mix, Plant Turnover and Productivity Growth: A Case Study of the Electronic and Electrical Product Manufacturing," Transnational Corporations Review, Ottawa United Learning Academy, vol. 4(1), pages 11-37, March.
    13. Danny Leung & Césaire Meh & Yaz Terajima, 2008. "Productivity in Canada: Does Firm Size Matter?," Bank of Canada Review, Bank of Canada, vol. 2008(Autumn), pages 7-16.
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    Cited by:

    1. Lin Shao & Rongsheng Tang, 2021. "Allocative Efficiency and Aggregate Productivity Growth in Canada and the United States," Staff Working Papers 21-1, Bank of Canada.
    2. Tang, Jianmin & Wang, Weimin, 2020. "Technological frontier, technical efficiency and the post-2000 productivity slowdown in Canada," Structural Change and Economic Dynamics, Elsevier, vol. 55(C), pages 12-25.

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