Economics at your fingertips  

The Dynamics of Productivity in the Telecommunications Equipment Industry

G Steven Olley and Ariel Pakes ()

Econometrica, 1996, vol. 64, issue 6, 1263-97

Abstract: Technological change and deregulation have caused a major restructuring telecommunications equipment industry over the last two decades. Our empirical focus is on estimating the parameters of a production function for the equipment industry, and then using those estimates to analyze the evolution of plant-level productivity. The restructuring involved significant entry and exit and large changes in the sizes of incumbents. This generates a selection and a simultaneity problem when estimating production functions. Our theoretical focus is on providing an estimation algorithm which takes explicit account of these issues. We find that our algorithm produces markedly different estimates of production function coefficients than do traditional estimation procedures, and that the productivity increases that followed deregulation were primarily a result of a reallocation of capital towards more productive establishments. Copyright 1996 by The Econometric Society.

Date: 1996
References: Add references at CitEc
Citations: View citations in EconPapers (2166) Track citations by RSS feed

Downloads: (external link) ... O%3B2-5&origin=repec full text (application/pdf)
Access to full text is restricted to JSTOR subscribers. See for details.

Related works:
Working Paper: The Dynamics Of Productivity In The Telecommunications Equipment Industry (1992) Downloads
Working Paper: The Dynamics of Productivity in the Telecommunications Equipment Industry (1992) Downloads
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link:

Ordering information: This journal article can be ordered from
https://www.economet ... ordering-back-issues

Access Statistics for this article

Econometrica is currently edited by Daron Acemoglu

More articles in Econometrica from Econometric Society Contact information at EDIRC.
Bibliographic data for series maintained by Wiley-Blackwell Digital Licensing ().

Page updated 2019-11-11
Handle: RePEc:ecm:emetrp:v:64:y:1996:i:6:p:1263-97