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Creative Destruction or Just Plain Destruction?: The U.S. Textile and Apparel Industries since 1972

  • Jim Levinsohn
  • Wendy Petropoulos

Are the U.S. textile and apparel industries examples of creative destruction or are they just plain destructing? We investigate this question using both aggregate industry-level data and plant-level data from the U.S. Census' LRD. We find that while the aggregate-level evidence is consistent with the common view of these industries as examples of declining industries, the plant-level data support a very different and much more hopeful view. We find that in the face of intensified international competition, each industry has evolved in its own way. In textiles, there has been tremendous capitalization. In apparel, the organization of production has changed. In both cases, industry productivity has increased markedly, and this is mostly because individual plants are becoming more productive.

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File URL: http://www.nber.org/papers/w8348.pdf
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Paper provided by National Bureau of Economic Research, Inc in its series NBER Working Papers with number 8348.

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Date of creation: Jun 2001
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Handle: RePEc:nbr:nberwo:8348
Note: IO ITI
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  1. Andrew B Bernard & Jonathan Eaton & J. Bradford Jensen & Samuel Kortum, 2000. "Plants and productivity in international trade," Working Papers 00-08, Center for Economic Studies, U.S. Census Bureau.
  2. G. Steven Olley & Ariel Pakes, 1992. "The Dynamics of Productivity in the Telecommunications Equipment Industry," NBER Working Papers 3977, National Bureau of Economic Research, Inc.
  3. Steve J. Davis & John Haltiwanger, 1991. "Gross Job Creation, Gross Job Destruction and Employment Reallocation," NBER Working Papers 3728, National Bureau of Economic Research, Inc.
  4. Mark J. Melitz, 2002. "The Impact of Trade on Intra-Industry Reallocations and Aggregate Industry Productivity," NBER Working Papers 8881, National Bureau of Economic Research, Inc.
  5. Baldwin, John R., 1999. "A Portrait of Entrants and Exits," Analytical Studies Branch Research Paper Series 1999121e, Statistics Canada, Analytical Studies Branch.
  6. James Levinsohn & Amil Petrin, 1999. "When Industries Become More Productive, Do Firms?," NBER Working Papers 6893, National Bureau of Economic Research, Inc.
  7. John Haltiwanger & C J Krizan & Lucia Foster, 1998. "Aggregate Productivity Growth: Lessons From Microeconomic Evidence," Working Papers 98-12, Center for Economic Studies, U.S. Census Bureau.
  8. James Levinsohn & Amil Petrin, 2000. "Estimating Production Functions Using Inputs to Control for Unobservables," NBER Working Papers 7819, National Bureau of Economic Research, Inc.
  9. Robinson, Peter M, 1988. "Root- N-Consistent Semiparametric Regression," Econometrica, Econometric Society, vol. 56(4), pages 931-54, July.
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