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Australia's firm-level productivity -- a new perspective

Author

Listed:
  • Robert Breunig

    (Research School of Social Sciences, Australian National University)

  • Marn-Heong Wong

    (Australia-Japan Research Centre, Australian National University)

Abstract

Not all firms contributed to Australia's impressive productivity growth in the 1990s. Some performed better than others, and entrants arrived even as incumbents exited. If firms make decisions on input demand and liquidation based on their productivity, the latter known to them but unobserved by the econometrician, this gives rise to simultaneity and selection problems that bias the traditional estimators of production function coefficients. We apply a semiparametric technique that endogenizes input choices and firm exit decisions to obtain production function estimates on Australian firms. Estimation is carried out using the Business Longitudinal Survey, Australia's only business longitudinal micro-dataset that tracks firm entry and exit.

Suggested Citation

  • Robert Breunig & Marn-Heong Wong, "undated". "Australia's firm-level productivity -- a new perspective," Australasian Stata Users' Group Meetings 2004 2, Stata Users Group.
    • Handle: RePEc:boc:osug04:2
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    JEL classification:

    • C14 - Mathematical and Quantitative Methods - - Econometric and Statistical Methods and Methodology: General - - - Semiparametric and Nonparametric Methods: General
    • D24 - Microeconomics - - Production and Organizations - - - Production; Cost; Capital; Capital, Total Factor, and Multifactor Productivity; Capacity

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