NATIONAL BUREAU OF ECONOMIC RESEARCH
NATIONAL BUREAU OF ECONOMIC RESEARCH
loading...

A Sufficient Statistics Approach for Aggregating Firm-Level Experiments

David Sraer, David Thesmar

NBER Working Paper No. 24208
Issued in January 2018
NBER Program(s):Corporate Finance Program, Productivity, Innovation, and Entrepreneurship Program

We consider a dynamic economy populated by heterogeneous firms subject to generic capital frictions: adjustment costs, taxes and financing constraints. A random subset of firms in this economy receives an empirical "treatment", which modifies the parameters governing these frictions. An econometrician observes the firm-level response to this treatment, and wishes to calculate how macroeconomic outcomes would change if all firms in the economy were treated. Our paper proposes a simple methodology to estimate this aggregate counterfactual using firm-level evidence only. Our approach takes general equilibrium effects into account, requires neither a structural estimation nor a precise knowledge on the exact nature of the experiment and can be implemented using simple moments of the distribution of revenue-to-capital ratios. We provide a set of sufficient conditions under which these formulas are valid and investigate the robustness of our approach to multiple variations in the aggregation framework.

download in pdf format
   (556 K)

email paper

Machine-readable bibliographic record - MARC, RIS, BibTeX

Document Object Identifier (DOI): 10.3386/w24208

Users who downloaded this paper also downloaded* these:
Haltiwanger, Kulick, and Syverson w24199 Misallocation Measures: The Distortion That Ate the Residual
Moscona, Nunn, and Robinson w24209 Kinship and Conflict: Evidence from Segmentary Lineage Societies in Sub-Saharan Africa
Barattieri, Basu, and Gottschalk w16130 Some Evidence on the Importance of Sticky Wages
Dobbie, Grönqvist, Niknami, Palme, and Priks w24186 The Intergenerational Effects of Parental Incarceration
Acemoglu and Restrepo w24196 Artificial Intelligence, Automation and Work
 
Publications
Activities
Meetings
NBER Videos
Themes
Data
People
About

National Bureau of Economic Research, 1050 Massachusetts Ave., Cambridge, MA 02138; 617-868-3900; email: info@nber.org

Contact Us