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Productivity and Employment in APAC Economies: A Comparison with the EU Using Firm-Level Information

Author

Listed:
  • Mauro, Filippo di

    (Asian Development Bank Institute)

  • Hoang, Minh Duy

    (Asian Development Bank Institute)

  • Morgan, Peter

    (Asian Development Bank Institute)

Abstract

We provide an overview of productivity development and other related indicators in Asia and Pacific (APAC) countries, with comparisons with the Europe region. We use the seventh vintage firm-level data from the Productivity Research Network in the APAC region and CompNet in Europe for our study. The overall results show that the productivity growth in developed APAC countries (Australia, New Zealand, and the Republic of Korea) is significantly ahead of the growth in developing APAC countries (India and the People’s Republic of China) and on par with the EU’s growth. There is an ongoing process of bottom firms catching up with top firms in the Republic of Korea and the richest EU countries. Regarding employment and labor skills, employment growth has generally been quite stagnant in all regions. Labor skills, for which we use the wage premium as a proxy, are quite similar across most regions, with the richest EU countries showing a higher premium than the rest. Our test of the productivity–employment link indicates that the size of employment tends to have a greater impact on productivity in APAC countries, while labor skills have greater emphasis in the EU.

Suggested Citation

  • Mauro, Filippo di & Hoang, Minh Duy & Morgan, Peter, 2021. "Productivity and Employment in APAC Economies: A Comparison with the EU Using Firm-Level Information," ADBI Working Papers 1264, Asian Development Bank Institute.
    • Handle: RePEc:ris:adbiwp:1264
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    References listed on IDEAS

    as
    1. Olley, G Steven & Pakes, Ariel, 1996. "The Dynamics of Productivity in the Telecommunications Equipment Industry," Econometrica, Econometric Society, vol. 64(6), pages 1263-1297, November.
    2. James Levinsohn & Amil Petrin, 2003. "Estimating Production Functions Using Inputs to Control for Unobservables," The Review of Economic Studies, Review of Economic Studies Ltd, vol. 70(2), pages 317-341.
    3. Wooldridge, Jeffrey M., 2009. "On estimating firm-level production functions using proxy variables to control for unobservables," Economics Letters, Elsevier, vol. 104(3), pages 112-114, September.
    Full references (including those not matched with items on IDEAS)

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    More about this item

    Keywords

    productivity; firm-level; employment; labor costs; labor skills; wage premium; TFP dispersion; firm concentration; financial constraint; Filippo di Mauro; Minh Duy Hoang; Peter Morgan;
    All these keywords.

    JEL classification:

    • D24 - Microeconomics - - Production and Organizations - - - Production; Cost; Capital; Capital, Total Factor, and Multifactor Productivity; Capacity
    • E24 - Macroeconomics and Monetary Economics - - Consumption, Saving, Production, Employment, and Investment - - - Employment; Unemployment; Wages; Intergenerational Income Distribution; Aggregate Human Capital; Aggregate Labor Productivity
    • J21 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Labor Force and Employment, Size, and Structure
    • J24 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Human Capital; Skills; Occupational Choice; Labor Productivity
    • P52 - Political Economy and Comparative Economic Systems - - Comparative Economic Systems - - - Comparative Studies of Particular Economies

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