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Multinationals and Reallocation: Productivity Growth in the Canadian Manufacturing Sector

Jiang Li () and Wulong Gu

Analytical Studies Branch Research Paper Series from Statistics Canada, Analytical Studies Branch

Abstract: Output growth in Canadian manufacturing was slower in the 2000s than in the 1990s. The sector’s real output declined, in contrast to an overall increase in output in the business sector (Clarke and Couture 2017). It fell rapidly during the 2007-to-2009 financial crisis, and returned to its pre-crisis level only in 2016. The market share of foreign-controlled firms also declined after 2000 (Baldwin and Li 2017). This paper examines the role of multinationals and reallocation in productivity growth in the Canadian manufacturing sector for the period from 2001 to 2010, a period of significant change in this sector. It contributes to the literature on several fronts. First, it complements the literature by examining productivity growth at the firm level. This paper also seeks to examine whether the decline that started around 2006 was associated with changes in the effect of reallocation and the role of foreign multinationals in aggregate productivity growth.

Keywords: Productivity; Multinational enterprises; Manufacturing (search for similar items in EconPapers)
Date: 2017-10-30
New Economics Papers: this item is included in nep-bec, nep-eff and nep-tid
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