Competition and Productivity in Japanese Manufacturing Industries
NBER Working Paper No. 11540
This paper examines the determinants of productivity in Japanese manufacturing industries, looking particularly at the impact of product market competition on productivity. Using a newly available panel data on around ten thousand firms in Japanese manufacturing for the years 1994-2000, I show that competition, as measured by lower level of industrial price-cost margin, enhances productivity growth, controlling for a broad range of industrial and firm-specific characteristics. Moreover, I suggest that market power, as measured by either individual firm’s price-cost margin or market share, has negative impact on productivity level of R&D performing firms.
Published: Okada, Yosuke. "Competition And Productivity In Japanese Manufacturing Industries," Journal of the Japanese and International Economies, 2005, v19(4,Dec), 586-616.