EconPapers    
Economics at your fingertips  
 

Labor Productivity: Structural Change And Cyclical Dynamics

Martin Neil Baily, Eric Bartelsman () and John Haltiwanger

The Review of Economics and Statistics, 2001, vol. 83, issue 3, 420-433

Abstract: A longstanding issue in empirical economics is the behavior of average labor productivity over the business cycle. This paper provides new insights into the cyclicality of aggregate labor productivity by examining the cyclical behavior of productivity at the plant level as well as the role of reallocation across plants over the cycle. We find that plant-level productivity is even more procyclical than aggregate productivity, because short-run reallocation yields a countercyclical contribution to labor productivity. At the plant level, we find that cyclicality of productivity varies systematically with long-run employment growth. Over the course of the cycle, plants that are long-run downsizers exhibit significantly greater procyclicality of productivity than do long-run upsizers. When we control for the direction of a cyclical shock, we find that the fall in productivity from an adverse cyclical shock for long-run downsizers is significantly larger in magnitude than is the fall in productivity from an equivalent adverse cyclical shock for long-run upsizers. We argue that these findings raise questions about one of the most popular explanations of procyclical productivity: changing factor utilization over the cycle. © 2001 by the President and Fellows of Harvard College and the Massachusetts Institute of Technology

Date: 2001
References: Add references at CitEc
Citations View citations in EconPapers (77) Track citations by RSS feed

Downloads: (external link)
http://www.mitpressjournals.org/doi/pdf/10.1162/00346530152480072 (application/pdf)
Access to full text is restricted to subscribers.

Related works:
Working Paper: Labor Productivity: Structural Change and Cyclical Dynamics (1998) Downloads
Working Paper: Labor productivity: structural change and cyclical dynamics (1996) Downloads
Working Paper: Labor Productivity: Structural Change and Cyclical Dynamics (1996) Downloads
Working Paper: Labor productivity: structural change and cyclical dynamics (1995) 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: https://EconPapers.repec.org/RePEc:tpr:restat:v:83:y:2001:i:3:p:420-433

Ordering information: This journal article can be ordered from
http://mitpress.mit. ... me.tcl?issn=00346535

Access Statistics for this article

The Review of Economics and Statistics is currently edited by Daron Acemoglu, George J. Borjas, Dani Rodrik and Julio J. Rotemberg

More articles in The Review of Economics and Statistics from MIT Press
Series data maintained by Kristin Waites ().

 
Page updated 2017-09-29
Handle: RePEc:tpr:restat:v:83:y:2001:i:3:p:420-433