Productivity dispersion and firm growth in Canada

Jangho Yang (), Brian Cozzarin and Torsten Heinrich
Additional contact information
Jangho Yang: University of Waterloo
Brian Cozzarin: University of Waterloo
Torsten Heinrich: Institute of New Economic Thinking, University of Oxford

Journal of Evolutionary Economics, 2025, vol. 35, issue 1, No 2, 35-70

Abstract: Abstract This study examines whether the growing disparity in labor productivity between firms in Canada is associated with the ability of these firms to grow in the Canadian economy. Using Canada’s Corporate Tax Statistics Universal File, we identify an inverted U-shaped relationship between labor productivity and fixed-asset growth rates, which subsequently results in a negative association between growing dispersion and lower growth rates. Econometric analyses reveal that a 1% increase in productivity dispersion leads to a 0.06 percentage point reduction in industry-level growth rates. We consider Schumpeterian and other evolutionary approaches for explaining this phenomenon and propose a simple population dynamics model.

Keywords: Labor productivity; Dispersion; Fixed-asset growth (search for similar items in EconPapers)
JEL-codes: D2 J24 O3 R12 (search for similar items in EconPapers)
Date: 2025
References: Add references at CitEc
Citations:

Downloads: (external link)
http://link.springer.com/10.1007/s00191-025-00891-z Abstract (text/html)
Access to the full text of the articles in this series is restricted.

Related works:
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: https://EconPapers.repec.org/RePEc:spr:joevec:v:35:y:2025:i:1:d:10.1007_s00191-025-00891-z

Ordering information: This journal article can be ordered from
http://www.springer.com/economics/journal/191/PS2

DOI: 10.1007/s00191-025-00891-z

Access Statistics for this article

Journal of Evolutionary Economics is currently edited by Uwe Cantner, Elias Dinopoulos, Horst Hanusch and Luigi Orsenigo

More articles in Journal of Evolutionary Economics from Springer
Bibliographic data for series maintained by Sonal Shukla () and Springer Nature Abstracting and Indexing ().