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The evolution of the productivity dispersion of firms - A reevaluation of its determinants in the case of Japan

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  • ITO Keiko
  • Sebastien LECHEVALIER

Abstract

There is a growing body of literature analyzing empirically the evolution of productivity dispersion at the firm level and its determinants. This paper contributes to this literature by investigating the case of Japanese firms during the so-called "Lost Decade" (1992-2005), which is still under-analyzed. We use a firm-level panel dataset taken from a large-scale administrative survey, the Basic Survey of Japanese Business Structure and Activities (BSBSA) for the years 1994-2003. Our results can be summarized as follows. First, we confirm that there was an overall increase in both labor productivity and total factor productivity dispersion, especially in the manufacturing sector from 1998 onward. Second, in the case of Japanese firms during the Lost Decade, and contrary to what has been found for some other countries, we find no significant impact of the introduction of information and communication technologies (ICT) on productivity dispersion. On the other hand, we do find evidence of a significant and positive impact of internationalization on productivity dispersion. In addition, the evolution of the competitive environment appears to play a role: we find that the increase in the Hershman-Herfindahl index observed in some sectors, which characterizes a more oligopolistic environment, is associated with an increase in productivity dispersion.

Suggested Citation

  • ITO Keiko & Sebastien LECHEVALIER, 2008. "The evolution of the productivity dispersion of firms - A reevaluation of its determinants in the case of Japan," Discussion papers 08014, Research Institute of Economy, Trade and Industry (RIETI).
  • Handle: RePEc:eti:dpaper:08014
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    References listed on IDEAS

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    Citations

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    Cited by:

    1. Archawa Paweenawat & Thitima Chucherd & Nakarin Amarase, 2017. "Uncovering Productivity Puzzles in Thailand: Lessons from Microdata," PIER Discussion Papers 73, Puey Ungphakorn Institute for Economic Research, revised Oct 2017.
    2. Daniela Maggioni, 2013. "Productivity Dispersion and its Determinants: The Role of Import Penetration," Journal of Industry, Competition and Trade, Springer, vol. 13(4), pages 537-561, December.
    3. repec:ebl:ecbull:eb-17-00341 is not listed on IDEAS
    4. Giuseppe Berlingieri & Patrick Blanchenay & Chiara Criscuolo, 2017. "The Great Divergence(s)," CEP Discussion Papers dp1488, Centre for Economic Performance, LSE.
    5. MORIKAWA Masayuki, 2017. "Dispersion and Volatility of TFPQ in Service Industries," Discussion papers 17088, Research Institute of Economy, Trade and Industry (RIETI).
    6. ANDO Mitsuyo & KIMURA Fukunari, 2012. "International Production Networks and Domestic Operations of Japanese Manufacturing Firms: Normal periods and the Global Financial Crisis," Discussion papers 12047, Research Institute of Economy, Trade and Industry (RIETI).
    7. Yannick Kalantzis & Ryo Kambayashi & Sébastien Lechevalier, 2012. "Wage and Productivity Differentials in Japan: The Role of Labor Market Mechanisms," LABOUR, CEIS, vol. 26(4), pages 514-541, December.
    8. Sébastien Lechevalier & Brieuc Monfort, 2016. "Abenomics: Has it worked? Will it fail?," Working Papers halshs-01415428, HAL.
    9. Hiroshi Nishi, 2016. "Sources and Consequences of Productivity Growth Dynamics: Is Japan Suffering from Baumol's Diseases?," Discussion papers e-16-003, Graduate School of Economics , Kyoto University.
    10. Keiko ITO, 2012. "Sources of Learning-by-Exporting Effects: Does Exporting Promote Innovation?," Working Papers DP-2012-06, Economic Research Institute for ASEAN and East Asia (ERIA).
    11. Rutzer, Christian, 2014. "A Theory of Trade Liberalization and Innovations with Heterogeneous Firms," Working papers 2014/02, Faculty of Business and Economics - University of Basel.
    12. ITO Keiko & LECHEVALIER Se'bastien, 2010. "Why Do Some Firms Persistently Outperform Others? An investigation of the interactions between innovation and export strategies," Discussion papers 10037, Research Institute of Economy, Trade and Industry (RIETI).
    13. Sébastien Lechevalier, 2012. "The Japanese Firm," Chapters,in: Handbook on the Economics and Theory of the Firm, chapter 16 Edward Elgar Publishing.
    14. Hiroshi Nishi, 2015. "Structural Change and Transformation of Growth Regime in the Japanese Economy," Discussion papers e-15-001, Graduate School of Economics Project Center, Kyoto University.
    15. Sébastien Lechevalier, 2015. "Globalization and labor market outcomes: de-industrialization, job security, and wage inequalities—introduction by guest editor," Review of World Economics (Weltwirtschaftliches Archiv), Springer;Institut für Weltwirtschaft (Kiel Institute for the World Economy), vol. 151(3), pages 405-408, August.
    16. Sebastien Lechevalier & Cyrille Dossougoin & Christophe Hurlin & Satoko Takaoka, 2014. "How did the Japanese Employment System Change?Investigating the Heterogeneity of Downsizing Practices across Firms," KIER Working Papers 883, Kyoto University, Institute of Economic Research.

    More about this item

    JEL classification:

    • L23 - Industrial Organization - - Firm Objectives, Organization, and Behavior - - - Organization of Production
    • L25 - Industrial Organization - - Firm Objectives, Organization, and Behavior - - - Firm Performance
    • O33 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Technological Change: Choices and Consequences; Diffusion Processes
    • B52 - Schools of Economic Thought and Methodology - - Current Heterodox Approaches - - - Historical; Institutional; Evolutionary

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