NATIONAL BUREAU OF ECONOMIC RESEARCH
NATIONAL BUREAU OF ECONOMIC RESEARCH

Robert C. Dent

Nomura Securities

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NBER Working Papers and Publications

September 2017Older and Slower: The Startup Deficit’s Lasting Effects on Aggregate Productivity Growth
with Titan Alon, David Berger, Benjamin Pugsley: w23875
We investigate the link between declining firm entry, aging incumbent firms and sluggish U.S. productivity growth. We provide a dynamic decomposition framework to characterize the contributions to industry productivity growth across the firm age distribution and apply this framework to the newly developed Revenue-enhanced Longitudinal Business Database (ReLBD). Overall, several key findings emerge: (i) the relationship between firm age and productivity growth is downward sloping and convex; (ii) the magnitudes are substantial and significant but fade quickly, with nearly 2/3 of the effect disappearing after five years and nearly the entire effect disappearing after ten; (iii) the higher productivity growth of young firms is driven nearly exclusively by the forces of selection and reallocat...

Published: Titan Alon & David Berger & Robert Dent & Benjamin Pugsley, 2017. "Older and Slower: The Startup Deficit’s Lasting Effects on Aggregate Productivity Growth," Journal of Monetary Economics, .

 
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