The importance of reallocation for productivity growth: Evidence from European and US banking

J. Bos, P.C. van Santen and P. Schilp

No 56, Research Memorandum from Maastricht University, Graduate School of Business and Economics (GSBE)

Abstract: This paper quantifies the effect of reallocation dynamics on aggregate productivity developments in the banking sectors of Europe and the United States. We document an increase in productivity over the period 1995-2009, on the order of 11% in the US and 19% in Europe. At an annual frequency, under-performing banks capture market share, while more productive banks lose market share, in particular in the US. The pattern of reallocation is markedly different between the geographical regions: European productivity has grown by reallocating inputs through the first half of the sample, at the same time when reallocation diminished growth in the US. Within-firm growth has been rising steadily in both areas, largely due to technical change. The long- run positive effects of creative destruction are especially apparent in the US, where reallocation is an important driver of increases in aggregate productivity.

Date: 2013-01-01
New Economics Papers: this item is included in nep-eff
References: View references in EconPapers View complete reference list from CitEc
Citations:

Downloads: (external link)
https://cris.maastrichtuniversity.nl/ws/files/1614 ... a158d6c-ASSET1.0.pdf (application/pdf)

Related works:
Working Paper: The Importance of Reallocation for Productivity Growth: Evidence from European and US Banking (2015)
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:unm:umagsb:2013056

DOI: 10.26481/umagsb.2013056

Access Statistics for this paper

More papers in Research Memorandum from Maastricht University, Graduate School of Business and Economics (GSBE) Contact information at EDIRC.
Bibliographic data for series maintained by Andrea Willems () and Leonne Portz ().