@techreport{NBERw6005,
 title = "Industry Evolution and Transition: A Neoclassical Benchmark",
 author = "Andrew Atkeson and Patrick Kehoe",
 institution = "National Bureau of Economic Research",
 type = "Working Paper",
 series = "Working Paper Series",
 number = "6005",
 year = "1997",
 month = "April",
 URL = "http://www.nber.org/papers/w6005",
 abstract = {Recently, a large number of countries have undertaken major reforms that have led to a large increase in the number of new enterprises.  After these reforms, however, it has taken a number of  years before output and productivity have begun to grow.  The thesis of this paper is that the process of starting new enterprises is turbulent and time-consuming and as a result, it takes time before the benefits of reform show up in increases in measured output and productivity.  To establish a neoclassical benchmark for reforming economies, we ask what the path of transition looks like in a reforming economy for which the process governing the growth of new enterprises looks like it does in the U.S., a well-functioning market economy.  We find that it takes 5-7 years until measured output and productivity begin to grow rapidly following reform.  This finding suggests that, even if all other aspects of the economy are perfect, the transition following economy-wide reforms should take a substantial amount of time.},
}