Creative Destruction and Policy Reforms : Changing Productivity Effects of Firm Turnoverin Moroccan Manufacturing
How important is firm turnover to national productivity growth? The literature points to the contribution of creative destruction being strongest in more developed countries or where market institutions are strongest. This paper looks at the case o...
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| Format: | Policy Research Working Paper |
| Language: | English |
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2012
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| Online Access: | http://www-wds.worldbank.org/external/default/main?menuPK=64187510&pagePK=64193027&piPK=64187937&theSitePK=523679&menuPK=64187510&searchMenuPK=64187283&siteName=WDS&entityID=000158349_20091020160355 http://hdl.handle.net/10986/4277 |
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okr-10986-4277 |
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| recordtype |
oai_dc |
| repository_type |
Digital Repository |
| institution_category |
Foreign Institution |
| institution |
Digital Repositories |
| building |
World Bank Open Knowledge Repository |
| collection |
World Bank |
| language |
English |
| topic |
ACCOUNTING AGGLOMERATION EFFECTS AGGREGATE FLUCTUATIONS AGGREGATE PERFORMANCE AGGREGATE PRODUCTIVITY AGGREGATE PRODUCTIVITY GROWTH ALLOCATIVE EFFICIENCY AVERAGE PRODUCTIVITY BARRIERS TO ENTRY BASE YEAR BOOK VALUE BUSINESS CLIMATE BUSINESS CYCLE BUSINESS REGULATION BUSINESSES CASUAL WORKER CASUAL WORKERS COMMERCE COMPARATIVE ANALYSIS COMPETITIVE ADVANTAGE COMPETITIVE PRESSURES COMPETITIVENESS COMPETITORS CORPORATION CREATIVE DESTRUCTION DEFLATORS DEVELOPMENT ECONOMICS DRIVERS ECONOMETRICS ECONOMIC ACTIVITY ECONOMIC CONDITIONS ECONOMIC DEVELOPMENT ECONOMIC OUTLOOK EMPLOYMENT ENTREPRENEURSHIP ENTRY RATE EQUIPMENT EXPORT LED GROWTH EXPORTS EXTERNALITIES FIRM DYNAMICS FIRM ENTRY FIRM EXIT FIRM LEVEL FIRM PERFORMANCE FIRM PRODUCTIVITY FIRM SURVEY FIRM TURNOVER FOREIGN OWNERSHIP FREE PRESS FUNCTIONAL FORMS GDP GDP DEFLATOR GROWTH RATE INDUSTRIAL STRUCTURE INDUSTRY CHARACTERISTICS INDUSTRY PRODUCTIVITY INEFFICIENCY INTERNATIONAL MARKETS INTERNATIONALIZATION JOB CREATION JOB DESTRUCTION JOB LOSS LABOR MARKETS LABOR PRODUCTIVITY LABOUR LABOUR PRODUCTIVITY LARGE ENTERPRISES LESS DEVELOPED COUNTRIES LOCAL INDUSTRY LONG-RUN EFFECTS MACROECONOMIC ANALYSIS MACROECONOMIC PERFORMANCE MACROECONOMIC POLICIES MACROECONOMICS MANUFACTURERS MANUFACTURING ENTERPRISES MANUFACTURING ESTABLISHMENTS MARKET SHARE MARKET SHARES MISSING VALUES MOTIVATION NET ENTRY COMPONENT NET ENTRY EFFECT NET JOB CREATION OUTPUTS PREVIOUS STUDIES PRIVATE SECTOR PRODUCTION FUNCTION PRODUCTIVE FIRMS PRODUCTIVITY PRODUCTIVITY COMPONENTS PRODUCTIVITY DECOMPOSITION PRODUCTIVITY DECOMPOSITIONS PRODUCTIVITY DISTRIBUTION PRODUCTIVITY EFFECTS PRODUCTIVITY GROWTH PRODUCTIVITY IMPROVEMENTS PRODUCTIVITY INCREASES PRODUCTIVITY LEVELS PRODUCTIVITY REGRESSION PRODUCTIVITY REGRESSIONS PROPERTY RIGHTS PROPRIETORSHIP PUBLIC ENTERPRISES RECESSIONARY PERIODS REGRESSION ANALYSIS REGULATORY REFORMS RESULT RESULTS SEES SMALL MANUFACTURING STATE OWNED COMPANIES STRUCTURAL CHANGE TELECOMMUNICATIONS TEMPORARY WORKERS TIME PERIOD TIME PERIODS TOTAL EMPLOYMENT TOTAL FACTOR PRODUCTIVITY TOTAL WORKERS TRADE LIBERALIZATION UNDERESTIMATES VALUE ADDED WAGES WEB WORKER |
| spellingShingle |
ACCOUNTING AGGLOMERATION EFFECTS AGGREGATE FLUCTUATIONS AGGREGATE PERFORMANCE AGGREGATE PRODUCTIVITY AGGREGATE PRODUCTIVITY GROWTH ALLOCATIVE EFFICIENCY AVERAGE PRODUCTIVITY BARRIERS TO ENTRY BASE YEAR BOOK VALUE BUSINESS CLIMATE BUSINESS CYCLE BUSINESS REGULATION BUSINESSES CASUAL WORKER CASUAL WORKERS COMMERCE COMPARATIVE ANALYSIS COMPETITIVE ADVANTAGE COMPETITIVE PRESSURES COMPETITIVENESS COMPETITORS CORPORATION CREATIVE DESTRUCTION DEFLATORS DEVELOPMENT ECONOMICS DRIVERS ECONOMETRICS ECONOMIC ACTIVITY ECONOMIC CONDITIONS ECONOMIC DEVELOPMENT ECONOMIC OUTLOOK EMPLOYMENT ENTREPRENEURSHIP ENTRY RATE EQUIPMENT EXPORT LED GROWTH EXPORTS EXTERNALITIES FIRM DYNAMICS FIRM ENTRY FIRM EXIT FIRM LEVEL FIRM PERFORMANCE FIRM PRODUCTIVITY FIRM SURVEY FIRM TURNOVER FOREIGN OWNERSHIP FREE PRESS FUNCTIONAL FORMS GDP GDP DEFLATOR GROWTH RATE INDUSTRIAL STRUCTURE INDUSTRY CHARACTERISTICS INDUSTRY PRODUCTIVITY INEFFICIENCY INTERNATIONAL MARKETS INTERNATIONALIZATION JOB CREATION JOB DESTRUCTION JOB LOSS LABOR MARKETS LABOR PRODUCTIVITY LABOUR LABOUR PRODUCTIVITY LARGE ENTERPRISES LESS DEVELOPED COUNTRIES LOCAL INDUSTRY LONG-RUN EFFECTS MACROECONOMIC ANALYSIS MACROECONOMIC PERFORMANCE MACROECONOMIC POLICIES MACROECONOMICS MANUFACTURERS MANUFACTURING ENTERPRISES MANUFACTURING ESTABLISHMENTS MARKET SHARE MARKET SHARES MISSING VALUES MOTIVATION NET ENTRY COMPONENT NET ENTRY EFFECT NET JOB CREATION OUTPUTS PREVIOUS STUDIES PRIVATE SECTOR PRODUCTION FUNCTION PRODUCTIVE FIRMS PRODUCTIVITY PRODUCTIVITY COMPONENTS PRODUCTIVITY DECOMPOSITION PRODUCTIVITY DECOMPOSITIONS PRODUCTIVITY DISTRIBUTION PRODUCTIVITY EFFECTS PRODUCTIVITY GROWTH PRODUCTIVITY IMPROVEMENTS PRODUCTIVITY INCREASES PRODUCTIVITY LEVELS PRODUCTIVITY REGRESSION PRODUCTIVITY REGRESSIONS PROPERTY RIGHTS PROPRIETORSHIP PUBLIC ENTERPRISES RECESSIONARY PERIODS REGRESSION ANALYSIS REGULATORY REFORMS RESULT RESULTS SEES SMALL MANUFACTURING STATE OWNED COMPANIES STRUCTURAL CHANGE TELECOMMUNICATIONS TEMPORARY WORKERS TIME PERIOD TIME PERIODS TOTAL EMPLOYMENT TOTAL FACTOR PRODUCTIVITY TOTAL WORKERS TRADE LIBERALIZATION UNDERESTIMATES VALUE ADDED WAGES WEB WORKER Hallward-Driemeier, Mary Thompson, Fraser Creative Destruction and Policy Reforms : Changing Productivity Effects of Firm Turnoverin Moroccan Manufacturing |
| geographic_facet |
Middle East and North Africa Morocco |
| relation |
Policy Research working paper ; no. WPS 5085 |
| description |
How important is firm turnover to
national productivity growth? The literature points to the
contribution of creative destruction being strongest in more
developed countries or where market institutions are
strongest. This paper looks at the case of Morocco, spanning
16 years, during which reform initiatives aiming to
strengthen market forces were introduced. The paper argues
that it is important to take into account i) the timing of
how decompositions are structured (capturing the effects of
high growth among young firms as part of the benefit of
increased entry) and ii) the additional indirect impacts of
firm dynamics on agglomeration externalities and
competition. The paper shows there are striking differences
in the productivity paths of entering and exiting firms
compared with incumbents, and that restricting the time
horizon of productivity decompositions to the actual year of
entry or exit underestimates the productivity effects of
turnover. Although it has been hypothesized that conducting
decompositions over longer horizons would increase the
positive contribution of net turnover, this is not the case
in Morocco as losses from exiting firms rise too. Nor has
the net contribution of turnover increased with market
reforms; if anything, the contribution has declined over
time. But the allocation of resources has improved. Both
technical and allocative efficiency have risen since the
mid-1990s. The paper also shows that firm turnover affects
productivity through additional channels. It is closely
correlated with measures of agglomeration that are
associated with higher rates of exit among unproductive
firms, and turnover itself is positively associated with
subsequent productivity growth of incumbents. |
| format |
Publications & Research :: Policy Research Working Paper |
| author |
Hallward-Driemeier, Mary Thompson, Fraser |
| author_facet |
Hallward-Driemeier, Mary Thompson, Fraser |
| author_sort |
Hallward-Driemeier, Mary |
| title |
Creative Destruction and Policy Reforms : Changing Productivity Effects of Firm Turnoverin Moroccan Manufacturing |
| title_short |
Creative Destruction and Policy Reforms : Changing Productivity Effects of Firm Turnoverin Moroccan Manufacturing |
| title_full |
Creative Destruction and Policy Reforms : Changing Productivity Effects of Firm Turnoverin Moroccan Manufacturing |
| title_fullStr |
Creative Destruction and Policy Reforms : Changing Productivity Effects of Firm Turnoverin Moroccan Manufacturing |
| title_full_unstemmed |
Creative Destruction and Policy Reforms : Changing Productivity Effects of Firm Turnoverin Moroccan Manufacturing |
| title_sort |
creative destruction and policy reforms : changing productivity effects of firm turnoverin moroccan manufacturing |
| publishDate |
2012 |
| url |
http://www-wds.worldbank.org/external/default/main?menuPK=64187510&pagePK=64193027&piPK=64187937&theSitePK=523679&menuPK=64187510&searchMenuPK=64187283&siteName=WDS&entityID=000158349_20091020160355 http://hdl.handle.net/10986/4277 |
| _version_ |
1764390712353226752 |
| spelling |
okr-10986-42772021-04-23T14:02:16Z Creative Destruction and Policy Reforms : Changing Productivity Effects of Firm Turnoverin Moroccan Manufacturing Hallward-Driemeier, Mary Thompson, Fraser ACCOUNTING AGGLOMERATION EFFECTS AGGREGATE FLUCTUATIONS AGGREGATE PERFORMANCE AGGREGATE PRODUCTIVITY AGGREGATE PRODUCTIVITY GROWTH ALLOCATIVE EFFICIENCY AVERAGE PRODUCTIVITY BARRIERS TO ENTRY BASE YEAR BOOK VALUE BUSINESS CLIMATE BUSINESS CYCLE BUSINESS REGULATION BUSINESSES CASUAL WORKER CASUAL WORKERS COMMERCE COMPARATIVE ANALYSIS COMPETITIVE ADVANTAGE COMPETITIVE PRESSURES COMPETITIVENESS COMPETITORS CORPORATION CREATIVE DESTRUCTION DEFLATORS DEVELOPMENT ECONOMICS DRIVERS ECONOMETRICS ECONOMIC ACTIVITY ECONOMIC CONDITIONS ECONOMIC DEVELOPMENT ECONOMIC OUTLOOK EMPLOYMENT ENTREPRENEURSHIP ENTRY RATE EQUIPMENT EXPORT LED GROWTH EXPORTS EXTERNALITIES FIRM DYNAMICS FIRM ENTRY FIRM EXIT FIRM LEVEL FIRM PERFORMANCE FIRM PRODUCTIVITY FIRM SURVEY FIRM TURNOVER FOREIGN OWNERSHIP FREE PRESS FUNCTIONAL FORMS GDP GDP DEFLATOR GROWTH RATE INDUSTRIAL STRUCTURE INDUSTRY CHARACTERISTICS INDUSTRY PRODUCTIVITY INEFFICIENCY INTERNATIONAL MARKETS INTERNATIONALIZATION JOB CREATION JOB DESTRUCTION JOB LOSS LABOR MARKETS LABOR PRODUCTIVITY LABOUR LABOUR PRODUCTIVITY LARGE ENTERPRISES LESS DEVELOPED COUNTRIES LOCAL INDUSTRY LONG-RUN EFFECTS MACROECONOMIC ANALYSIS MACROECONOMIC PERFORMANCE MACROECONOMIC POLICIES MACROECONOMICS MANUFACTURERS MANUFACTURING ENTERPRISES MANUFACTURING ESTABLISHMENTS MARKET SHARE MARKET SHARES MISSING VALUES MOTIVATION NET ENTRY COMPONENT NET ENTRY EFFECT NET JOB CREATION OUTPUTS PREVIOUS STUDIES PRIVATE SECTOR PRODUCTION FUNCTION PRODUCTIVE FIRMS PRODUCTIVITY PRODUCTIVITY COMPONENTS PRODUCTIVITY DECOMPOSITION PRODUCTIVITY DECOMPOSITIONS PRODUCTIVITY DISTRIBUTION PRODUCTIVITY EFFECTS PRODUCTIVITY GROWTH PRODUCTIVITY IMPROVEMENTS PRODUCTIVITY INCREASES PRODUCTIVITY LEVELS PRODUCTIVITY REGRESSION PRODUCTIVITY REGRESSIONS PROPERTY RIGHTS PROPRIETORSHIP PUBLIC ENTERPRISES RECESSIONARY PERIODS REGRESSION ANALYSIS REGULATORY REFORMS RESULT RESULTS SEES SMALL MANUFACTURING STATE OWNED COMPANIES STRUCTURAL CHANGE TELECOMMUNICATIONS TEMPORARY WORKERS TIME PERIOD TIME PERIODS TOTAL EMPLOYMENT TOTAL FACTOR PRODUCTIVITY TOTAL WORKERS TRADE LIBERALIZATION UNDERESTIMATES VALUE ADDED WAGES WEB WORKER How important is firm turnover to national productivity growth? The literature points to the contribution of creative destruction being strongest in more developed countries or where market institutions are strongest. This paper looks at the case of Morocco, spanning 16 years, during which reform initiatives aiming to strengthen market forces were introduced. The paper argues that it is important to take into account i) the timing of how decompositions are structured (capturing the effects of high growth among young firms as part of the benefit of increased entry) and ii) the additional indirect impacts of firm dynamics on agglomeration externalities and competition. The paper shows there are striking differences in the productivity paths of entering and exiting firms compared with incumbents, and that restricting the time horizon of productivity decompositions to the actual year of entry or exit underestimates the productivity effects of turnover. Although it has been hypothesized that conducting decompositions over longer horizons would increase the positive contribution of net turnover, this is not the case in Morocco as losses from exiting firms rise too. Nor has the net contribution of turnover increased with market reforms; if anything, the contribution has declined over time. But the allocation of resources has improved. Both technical and allocative efficiency have risen since the mid-1990s. The paper also shows that firm turnover affects productivity through additional channels. It is closely correlated with measures of agglomeration that are associated with higher rates of exit among unproductive firms, and turnover itself is positively associated with subsequent productivity growth of incumbents. 2012-03-19T19:13:08Z 2012-03-19T19:13:08Z 2009-10-01 http://www-wds.worldbank.org/external/default/main?menuPK=64187510&pagePK=64193027&piPK=64187937&theSitePK=523679&menuPK=64187510&searchMenuPK=64187283&siteName=WDS&entityID=000158349_20091020160355 http://hdl.handle.net/10986/4277 English Policy Research working paper ; no. WPS 5085 CC BY 3.0 IGO http://creativecommons.org/licenses/by/3.0/igo/ World Bank Publications & Research :: Policy Research Working Paper Middle East and North Africa Morocco |