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Path Dependent Patterns of Persistence in Productivity Growth

This paper contributes to the analysis of the persistence of firm productivity, here measured by the total factor productivity (TFP), and highlights its path dependent characteristics. The study contributes to the literature on persistence in productivity along four main lines. First, it develops a conceptual framework that links the persistence in productivity performance to persistence at the firm level in innovative activities, which include the adoption and imitation of innovations introduced by third parties. Second, it shows how the internal characteristics of companies, including the propensity of managers to leverage dynamic capabilities, can shape the dynamics of the process. Third, it confirms that external factors, such as the access to local pools of knowledge and the dynamics of economic activity, have relevant effects on persistence and shape its evolution along its path. Fourth, the use of Multiple Transition Probability Matrices (MTPMs) and the subsequent econometric analysis provides substantial evidence on the relevance of the crucial distinction, within non-ergodic dynamics, between past dependent processes, characterized by full hysteretic irrever sibility, and path dependent processes in which events that take place along the process may affect its direction and pace.

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File URL: http://www.unito.it/unitoWAR/ShowBinary/FSRepo/D031/Allegati/WP2013Dip/WP_23_2013.pdf
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Paper provided by University of Turin in its series Department of Economics and Statistics Cognetti de Martiis. Working Papers with number 201323.

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Length: 44 pages
Date of creation: May 2013
Date of revision:
Handle: RePEc:uto:dipeco:201323
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  1. Parisi, Maria Laura & Schiantarelli, Fabio & Sembenelli, Alessandro, 2006. "Productivity, innovation and R&D: Micro evidence for Italy," European Economic Review, Elsevier, vol. 50(8), pages 2037-2061, November.
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  15. Olley, G Steven & Pakes, Ariel, 1996. "The Dynamics of Productivity in the Telecommunications Equipment Industry," Econometrica, Econometric Society, vol. 64(6), pages 1263-97, November.
  16. 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.
  17. Paul A. David, 1997. "Path Dependence and the Quest for Historical Economics: One More chorus of Ballad of QWERTY," Oxford University Economic and Social History Series _020, Economics Group, Nuffield College, University of Oxford.
  18. Philippe Aghion & Peter Howitt, 1997. "Endogenous Growth Theory," MIT Press Books, The MIT Press, edition 1, volume 1, number 0262011662, June.
  19. Bloom, Nicholas & Van Reenen, John, 2006. "Measuring and Explaining Management Practices Across Firms and Countries," CEPR Discussion Papers 5581, C.E.P.R. Discussion Papers.
  20. Pekka Ilmakunnas & Mika Maliranta & Jari Vainiomaki, 2000. "The Roles of Employer and Employee Characteristics for Plant Productivity," Econometric Society World Congress 2000 Contributed Papers 1349, Econometric Society.
  21. Elena Cefis & Matteo Ciccarelli, 2005. "Profit differentials and innovation," Economics of Innovation and New Technology, Taylor & Francis Journals, vol. 14(1-2), pages 43-61.
  22. Antonelli,Cristiano & Crespi, Francesco & Scellato, Giuseppe, 2012. "Inside innovation persistence: New evidence from Italian micro-data," Department of Economics and Statistics Cognetti de Martiis LEI & BRICK - Laboratory of Economics of Innovation "Franco Momigliano", Bureau of Research in Innovation, Complexity and Knowledge, Collegio 201213, University of Turin.
  23. Tommy Clausen & Mikko Pohjola & Koson Sapprasert & Bart Verspagen, 2012. "Innovation strategies as a source of persistent innovation," Industrial and Corporate Change, Oxford University Press, vol. 21(3), pages 553-585, June.
  24. Antonelli, Cristiano & Crespi, Francesco & Scellato, Giuseppe, 2012. "Internal and external factors in innovation persistence," Department of Economics and Statistics Cognetti de Martiis LEI & BRICK - Laboratory of Economics of Innovation "Franco Momigliano", Bureau of Research in Innovation, Complexity and Knowledge, Collegio 201211, University of Turin.
  25. Giulio Bottazzi & Angelo Secchi & Federico Tamagni, 2006. "Productivity, Profitability and Financial Fragility: Evidence from Italian Business Firms," LEM Papers Series 2006/08, Laboratory of Economics and Management (LEM), Sant'Anna School of Advanced Studies, Pisa, Italy.
  26. Dale W. Jorgenson & Mun S. Ho & Kevin J. Stiroh, 2008. "A Retrospective Look at the U.S. Productivity Growth Resurgence," Journal of Economic Perspectives, American Economic Association, vol. 22(1), pages 3-24, Winter.
  27. Eric J. Bartelsman & Mark Doms, 2000. "Understanding productivity: lessons from longitudinal microdata," Finance and Economics Discussion Series 2000-19, Board of Governors of the Federal Reserve System (U.S.).
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  30. Malerba, Franco & Orsenigo, Luigi & Peretto, Pietro, 1997. "Persistence of innovative activities, sectoral patterns of innovation and international technological specialization," International Journal of Industrial Organization, Elsevier, vol. 15(6), pages 801-826, October.
  31. Bart J. Bronnenberg & Sanjay K. Dhar & Jean-Pierre H. Dubé, 2009. "Brand History, Geography, and the Persistence of Brand Shares," Journal of Political Economy, University of Chicago Press, vol. 117(1), pages 87-115, 02.
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