ENTRY AND PRODUCTIVITY GROWTH: EVIDENCE FROM MICROLEVEL PANEL DATA

By Philippe Aghion, Richard Blundell, Rachel Griffith, Peter Howitt, Susanne Prantl. 2004

318 citations recorded by the source corpus.

How does entry affect productivity growth of incumbents? In this paper we exploit policy reforms in the United Kingdom that changed entry conditions by opening up the U.K. economy during the 1980s and panel data on British establishments to shed light on this question. We show that more entry, measured by a higher share of industry employment in foreign firms, has led to faster total factor productivity growth of domestic incumbent firms and thus to faster aggregate productivity growth. (JEL: L5, L10, O31, O4)

Subfields: Economics and Econometrics

View Paper: https://www.semanticscholar.org/paper/94b5db675fe252178936b57dd78cdbb5ac988735

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Citations in the corpus

Entrepreneurship, regional development and job creation: the case of Portugal (2007, background): “Aghion et al. (2004) focus on the effect of entry on productivity growth, showing that more entry by foreign firms has led to faster total factor productivity growth in British manufacturing establishments during the period 198093.”
Do Product Market Regulations in Upstream Sectors Curb Productivity Growth? Panel Data Evidence For OECD Countries (2013, background): “…1995a, 1995b; Nickell, 1996; Nickell, Nicolitsas, & Dryden, 1997; Blundell, Griffith, & Van Reenen, 1999; Griffith, Redding, & Simpson, 2002; Aghion et al., 2004; Haskel, Pereira, & Slaughter, 2007), especially for incumbent firms that are close to the technological frontier (Aghion et al.,…”
Appropriate growth policy: a unifying framework (2006, methodology): “The model draws on the more formal analysis of Aghion et al. (2004) and Aghion et al. (2005a).”
Learning from Trade Through Innovation (2010, unknown): “This sequencing, however, is shown to be more pronounced (1) when firms start with the imports engagement first, (2) for small firms, and (3) firms at the technology frontier.”
Innovation and Trade with Heterogeneous Firms (2011, unknown): “Another is the se- 1See, for example, the seminal paper by Dasgupta and Stiglitz (1980), as well as the more recent work by Aghion et al. (2004, 2005).”
Environmental policies and productivity growth: a critical review of empirical findings (2015, background): “…pressures, for instance by raising entry barriers or directly discriminating between incumbents and new firms, they may pose a drag on productivity growth or innovation (see Aghion et al., 2005; Aghion et al., 2004; Bourlès et al., 2010; for discussions on entry barriers and competition).”
Knowledge-Based Capital, Innovation and Resource Allocation (2013, background): “…studies that show a negative relationship between PMR and productivity at the aggregate level (Bouis et al., 2011) and the firm and sectoral levels (Aghion et al., 2004; Bourles et al., 2010) and an inverted U-shaped relationship between indicators of competition and innovation (Aghion et al.,…”
The Effects of Entry on Incumbent Innovation and Productivity (2005, background): “2 Aghion et al. (2004), Grifﬁth, Redding, and Simpson (2002), and Haskel, Pereira, and Slaughter (2007) show for U.K. industries positive correlations of (increases in) the employment share in foreign ﬁrms and average growth of total factor productivity in domestic producers.”