Business Dynamism and Innovation: Evidence from Novel 19th-Century Microdata

Antonin Bergeaud, Ruveyda Nur Gozen and Suleyman Gozen
Additional contact information
Antonin Bergeaud: HEC Paris - Ecole des Hautes Etudes Commerciales
Ruveyda Nur Gozen: Cardiff University
Suleyman Gozen: University of Bristol [Bristol]

Working Papers from HAL

Abstract: We construct a novel establishment-level dataset combining the nineteenth-century U.S. Census of Manufactures (1850-1880) with patent records from CUSP to examine how innovation shaped firm performance in early industrial America. Patenting establishments were substantially larger than comparable non-patenters across all dimensions (employment, capital, output, and output per worker) with premia further amplified among firms that produced breakthrough inventions. Estimating establishment-level production functions using Levinsohn-Petrin approach, we find that patenting is associated with higher revenue total factor productivity (TFPR) while leaving markups unchanged on average. Breakthrough innovations, however, are associated with gains on both margins, with a size decomposition revealing the strongest amplification among the largest establishments, consistent with superstar dynamics, yet small breakthrough innovators also capture meaningful gains, suggesting the returns to invention were not exclusive to large firms.

Keywords: Productivity; Innovation; Entrepreneurship; Establishment Performance; Production Function Estimation; Industrial Revolution; Economic Development (search for similar items in EconPapers)
Date: 2026-08-01
References: Add references at CitEc
Citations:

There are no downloads for this item, see the EconPapers FAQ for hints about obtaining it.

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:hal:wpaper:hal-05730445

DOI: 10.2139/ssrn.7144078

Access Statistics for this paper

More papers in Working Papers from HAL
Bibliographic data for series maintained by CCSD ().