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Micro-based evidence of EU competitiveness: the CompNet database

Author

Listed:
  • Dhyne, Emmanuel
  • di Mauro, Filippo
  • Berthou, Antoine
  • Galuščák, Kamil
  • Altomonte, Carlo
  • Opromolla, Luca David
  • Amador, João
  • Soares, Ana Cristina
  • Lopez-Garcia, Paloma
  • Benatti, Nicola
  • Angeloni, Chiara
  • Bugamelli, Matteo
  • D’Aurizio, Leandro
  • Navaretti, Giorgio Barba
  • Forlani, Emanuele
  • Rossetti, Stefania
  • Zurlo, Davide
  • Sandoz-Dit-Bragard, Charlotte
  • Chiriacescu, Bogdan
  • Cazacu, Ana-Maria
  • Lalinsky, Tibor
  • Biewen, Elena
  • Blank, Sven
  • Meinen, Philipp
  • Hagemejer, Jan
  • Tello, Patry
  • Rodríguez-Caloca, Antonio
  • Čede, Urška
  • Meriküll, Jaanika
  • Harasztosi, Péter

Abstract

Drawing from confidential firm-level balance sheets in 11 European countries, the paper presents a novel sectoral database of comparable productivity indicators built by members of the Competitiveness Research Network (CompNet) using a newly developed research infrastructure. Beyond aggregate information available from industry statistics of Eurostat or EU KLEMS, the paper provides information on the distribution of firms across several dimensions related to competitiveness, e.g. productivity and size. The database comprises so far 11 countries, with information for 58 sectors over the period 1995-2011. The paper documents the development of the new research infrastructure, describes the database, and shows some preliminary results. Among them, it shows that there is large heterogeneity in terms of firm productivity or size within narrowly defined industries in all countries. Productivity, and above all, size distribution are very skewed across countries, with a thick left-tail of low productive firms. Moreover, firms at both ends of the distribution show very different dynamics in terms of productivity and unit labour costs. Within-sector heterogeneity and productivity dispersion are positively correlated to aggregate productivity given the possibility of reallocating resources from less to more productive firms. To this extent, we show how allocative efficiency varies across countries, and more interestingly, over different periods of time. Finally, we apply the new database to illustrate the importance of productivity dispersion to explain aggregate trade results. JEL Classification: L11, L25, D24, O4, O57

Suggested Citation

  • Dhyne, Emmanuel & di Mauro, Filippo & Berthou, Antoine & Galuščák, Kamil & Altomonte, Carlo & Opromolla, Luca David & Amador, João & Soares, Ana Cristina & Lopez-Garcia, Paloma & Benatti, Nicola & Ang, 2014. "Micro-based evidence of EU competitiveness: the CompNet database," Working Paper Series 1634, European Central Bank.
  • Handle: RePEc:ecb:ecbwps:20141634
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    File URL: https://www.ecb.europa.eu/pub/pdf/scpwps/ecbwp1634.pdf
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    References listed on IDEAS

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    1. Dan Andrews & Federico Cingano, 2014. "Public policy and resource allocation: evidence from firms in OECD countries," Economic Policy, CEPR;CES;MSH, vol. 29(78), pages 253-296, April.
    2. Zvi Griliches & Jacques Mairesse, 1995. "Production Functions: The Search for Identification," NBER Working Papers 5067, National Bureau of Economic Research, Inc.
    3. Carlo Altomonte & Tommaso Aquilante & Gianmarco Ottaviano, . "The triggers of competitiveness: The EFIGE cross-country report," Blueprints, Bruegel, number 738.
    4. Melitz, Marc J. & Redding, Stephen J., 2014. "Heterogeneous Firms and Trade," Handbook of International Economics, Elsevier.
    5. Eric Bartelsman & John Haltiwanger & Stefano Scarpetta, 2013. "Cross-Country Differences in Productivity: The Role of Allocation and Selection," American Economic Review, American Economic Association, vol. 103(1), pages 305-334, February.
    6. Marc J. Melitz & Gianmarco I. P. Ottaviano, 2008. "Market Size, Trade, and Productivity," Review of Economic Studies, Oxford University Press, vol. 75(1), pages 295-316.
    7. William Kerr & Ufuk Akcigit & Nicholas Bloom & Daron Acemoglu, 2012. "Innovation, Reallocation and Growth," 2012 Meeting Papers 1137, Society for Economic Dynamics.
    8. James Levinsohn & Amil Petrin, 2003. "Estimating Production Functions Using Inputs to Control for Unobservables," Review of Economic Studies, Oxford University Press, vol. 70(2), pages 317-341.
    9. John Martin & Stefano Scarpetta, 2012. "Setting It Right: Employment Protection, Labour Reallocation and Productivity," De Economist, Springer, vol. 160(2), pages 89-116, June.
    10. Haltiwanger, John, 2011. "Firm dynamics and productivity growth," EIB Papers 5/2011, European Investment Bank, Economics Department.
    11. Ackerberg, Daniel & Caves, Kevin & Frazer, Garth, 2006. "Structural identification of production functions," MPRA Paper 38349, University Library of Munich, Germany.
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    Citations

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    Cited by:

    1. Glenn Magerman & Karolien De Bruyne & Emmanuel Dhyne & Jan Van Hove, 2016. "Heterogeneous Firms and the Micro Origins of Aggregate Fluctuations," Working Papers ECARES ECARES 2016-35, ULB -- Universite Libre de Bruxelles.
    2. Michel Dumont & Chantal Kegels, 2016. "Working Paper 06-16 - Young Firms and Industry Dynamics in Belgium," Working Papers 1606, Federal Planning Bureau, Belgium.

    More about this item

    Keywords

    allocative efficiency; competitiveness; cross country analysis; firm-level data; productivity and size distribution; total factor productivity;

    JEL classification:

    • 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
    • D24 - Microeconomics - - Production and Organizations - - - Production; Cost; Capital; Capital, Total Factor, and Multifactor Productivity; Capacity
    • O4 - Economic Development, Innovation, Technological Change, and Growth - - Economic Growth and Aggregate Productivity
    • O57 - Economic Development, Innovation, Technological Change, and Growth - - Economywide Country Studies - - - Comparative Studies of Countries

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