Productivity Dispersion and Plant Selection in the Ready-Mix Concrete Industry
Allan Collard-Wexler ()
Working Papers from U.S. Census Bureau, Center for Economic Studies
This paper presents a quantitative model of productivity dispersion to explain why inefficient producers are slowly selected out of the ready-mix concrete industry. Measured productivity dispersion between the 10th and 90th percentile falls from a 4 to 1 difference using OLS, to a 2 to 1 difference using a control function. Due to volatile productivity and high sunk entry costs, a dynamic oligopoly model shows that to rationalize small gaps in exit rates between high and low productivity plants, a plant in the top quintile must produce 1.5 times more than a plant in the bottom quintile.
JEL-codes: D24 L13 L6 (search for similar items in EconPapers)
Pages: 58 pages
New Economics Papers: this item is included in nep-eff
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https://www2.census.gov/ces/wp/2011/CES-WP-11-25.pdf First version, 2011 (application/pdf)
Working Paper: Productivity Dispersion and Plant Selection in the Ready-Mix Concrete Industry (2010)
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Persistent link: https://EconPapers.repec.org/RePEc:cen:wpaper:11-25
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