Productivity Dispersion and Structural Change in Retail Trade

Dominic Smith, Glenn Blackwood, Michael D. Giandrea, Cheryl Grim, Jay Stewart and Zoltán Wolf

Working Papers from U.S. Census Bureau, Center for Economic Studies

Abstract: The retail sector has changed from a sector full of small firms to one dominated by large, national firms. We study how this transformation has impacted productivity levels, growth, and dispersion between 1987 and 2017. We describe this transformation using three overlapping phases: expansion (1980s and 1990s), consolidation (2000s), and stagnation (2010s). We document five findings that help us understand these phases. First, productivity growth was high during the consolidation phase but has fallen more recently. Second, entering establishments drove productivity growth during the expansion phase, but continuing establishments have increased in importance more recently. Third, national chains have more productive establishments than single-unit firms on average, but some single-unit establishments are highly productive. Fourth, productivity dispersion is significant and increasing over time. Finally, more productive firms pay higher wages and grow more quickly. Together, these results suggest that the increasing importance of large national retail firms has been an important driver of productivity and wage growth in the retail sector.

Keywords: retail; reallocation; business cycles; productivity dispersion (search for similar items in EconPapers)
JEL-codes: D24 E24 L81 (search for similar items in EconPapers)
Pages: 40 pages
Date: 2023-12
New Economics Papers: this item is included in nep-eff and nep-tid
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https://www2.census.gov/library/working-papers/2023/adrm/ces/CES-WP-23-60R.pdf Revised version, 2024 (application/pdf)
https://www2.census.gov/library/working-papers/2023/adrm/ces/CES-WP-23-60.pdf First version, 2023 (application/pdf)

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Persistent link: https://EconPapers.repec.org/RePEc:cen:wpaper:23-60

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