Abstract
In this paper we analyze the impact of micro-, meso-, and macro-economic determinants on firm productivity growth from an evolutionary and systemic perspective, in small and medium-sized Argentinean enterprises during 2006–2008. This period is characterized by strong employment and productivity growth. In this context, increases in productivity are explained better by innovation rather than falling employment. The microeconomic dimension is tackled by resorting to innovation results (product and process), which in turn are estimated through innovation efforts, following the well-known Crepon, Duguet, and Mairess (CDM) approach. The meso dimension is considered in terms of each firm’s position in the competitive space; that is, whether each firm’s productivity level is below or above the sector average. The macro determinant of changes in productivity considered here is the expansion of domestic demand, estimated by the sectoral apparent consumption. The results show that the micro and meso dimensions contribute to explaining firm-level productivity growth. Innovation results, estimated through innovation efforts and linkages, explain productivity growth. The firm’s position in the competitive space shows a U-shaped relationship with productivity growth. Finally, sectoral demand does not seem to have any impact on our study.
This paper was presented at the 14th Joseph A. Schumpeter Conference in Brisbane, and we would like to thank those present for the comments they made on it. We also want to thank Prof. G. Dosi for his comments in Buenos Aires on a previous version of this paper, as well as Prof. Keun Lee and F. Malerba. The usual disclaimer applies.
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Notes
- 1.
Abramovitz points out that the size of the Solow residual is nothing more than a measurement of our ignorance, and the growth accountability approach called it “total factor productivity” and its growth was attributed to technological progress.
- 2.
They also include changes in production capacities, both those embodied in the machinery and those present in the workforce connected to improvements in managerial skill, training, and capacity which reflect other capital investment (Kuznets 1952).
- 3.
From the aggregate perspective, the other relevant critique is capital controversy, at the end of the 1960s.
- 4.
This can be found by resorting to the representative agent production function.
- 5.
Taking into consideration the measurement difficulties that this implies, and assuming that it is possible to determine the change in output caused by a marginal change in the state of technological knowledge.
- 6.
Metcalfe (2010) recognizes this same evolutionary thread in these authors’ conceptions of competition.
- 7.
Despite these differences, there are numerous cross-references and some intellectual recognition between the two traditions. An example of this is a special section of Issue 6, 2010, of Industrial Change and Corporate Change coordinated by Giovanni Dosi, which reveals the coexistence of approaches that are rooted in the two main lines of thought discussed in the theoretical framework.
- 8.
Antonelli and Scellato (2011) have also tested the hypothesis of a U-shaped relationship between levels of profitability and innovative activity, looking for evidence around the Schumpeterian hypothesis on innovation and competition (Aghion and Howitt 1992). They confirmed theU-shaped relationship for the Italian case.
- 9.
Subsecretariat of SMEs at the Ministry of Production.
- 10.
This is revealed by the fact that observations have been made of each firm every year. Since we cannot be sure why firms did not stay in the database (firm mortality or rejection rate), we preferred to keep only the firms with observations for the three periods.
- 11.
As the aim of the SME Map is to survey the economic activity of SMEs in the trade, industry, and service sectors, we have excluded some industries where there is economic and productive concentration (e.g., tobacco). Graph 4 of statistical annex show the compare the productivity evolution of the sample with total manufacture industry.
- 12.
Source: Center for the Study of Production (CEP), Ministry of Production.
- 13.
The questionnaire asks, for example, if a set of innovation efforts were made during the last 2 years.
- 14.
Following Goldberger (1972), we define structural equation models as “stochastic models in which each equation represents a causal link, rather than a mere empirical association”.
- 15.
This index measures the average change in prices received by producers for their output, and so excludes the supply of imported goods and includes exports.
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A.1 Statistical Annex
A.1 Statistical Annex
Productivity growth (2006–2008) in sample and total manufacturing industry
Firms size distribution (in logs and number of employees)
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Robert, V., Pereira, M., Yoguel, G., Barletta, F. (2015). Micro, Macro, and Meso Determinants of Productivity Growth in Argentinian Firms. In: Pyka, A., Foster, J. (eds) The Evolution of Economic and Innovation Systems. Economic Complexity and Evolution. Springer, Cham. https://doi.org/10.1007/978-3-319-13299-0_23
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