Microeconomic Evidence of Creative Destruction in Industrial and Developing Countries

This paper analyzes the process of creative destruction across 24 countries and 2-digit industries. This approach harmonizes firm level data across countries, enabling international comparisons and the identification of country-specific as opposed to sectoral and time effects factors. All countries...

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Main Authors:	Bartelsman, Eric, Haltiwanger, John, Scarpetta, Stefano
Language:	English
Published:	Washington, DC: World Bank 2012
Subjects:	World Development Report 2005
Online Access:	http://hdl.handle.net/10986/9170

id	okr-10986-9170
recordtype	oai_dc
spelling	okr-10986-91702021-04-23T14:02:44Z Microeconomic Evidence of Creative Destruction in Industrial and Developing Countries Bartelsman, Eric Haltiwanger, John Scarpetta, Stefano World Development Report 2005 This paper analyzes the process of creative destruction across 24 countries and 2-digit industries. This approach harmonizes firm level data across countries, enabling international comparisons and the identification of country-specific as opposed to sectoral and time effects factors. All countries display a massive reallocation of resources, with the entry and exit of many firms in all markets, the failure of many newcomers and the expansion of successful ones. This process of creative destruction affects productivity directly, by reallocating resources towards more productive uses, but also indirectly through the effects of increased market contestability. While entry and exit rates are fairly similar across industrial countries, post entry performance differs markedly between Europe and the U.S., a potential indication of the importance of barriers to firm growth as opposed to barriers to entry. Transition economies show an even more impressive process of creative destruction and those that have made the most progress toward a market economy show better outcomes. 2012-06-26T15:40:08Z 2012-06-26T15:40:08Z 2004 http://hdl.handle.net/10986/9170 English CC BY 3.0 IGO http://creativecommons.org/licenses/by/3.0/igo/ World Bank Washington, DC: World Bank Europe and Central Asia Latin America & Caribbean
repository_type	Digital Repository
institution_category	Foreign Institution
institution	Digital Repositories
building	World Bank Open Knowledge Repository
collection	World Bank
language	English
topic	World Development Report 2005
spellingShingle	World Development Report 2005 Bartelsman, Eric Haltiwanger, John Scarpetta, Stefano Microeconomic Evidence of Creative Destruction in Industrial and Developing Countries
geographic_facet	Europe and Central Asia Latin America & Caribbean
description	This paper analyzes the process of creative destruction across 24 countries and 2-digit industries. This approach harmonizes firm level data across countries, enabling international comparisons and the identification of country-specific as opposed to sectoral and time effects factors. All countries display a massive reallocation of resources, with the entry and exit of many firms in all markets, the failure of many newcomers and the expansion of successful ones. This process of creative destruction affects productivity directly, by reallocating resources towards more productive uses, but also indirectly through the effects of increased market contestability. While entry and exit rates are fairly similar across industrial countries, post entry performance differs markedly between Europe and the U.S., a potential indication of the importance of barriers to firm growth as opposed to barriers to entry. Transition economies show an even more impressive process of creative destruction and those that have made the most progress toward a market economy show better outcomes.
author	Bartelsman, Eric Haltiwanger, John Scarpetta, Stefano
author_facet	Bartelsman, Eric Haltiwanger, John Scarpetta, Stefano
author_sort	Bartelsman, Eric
title	Microeconomic Evidence of Creative Destruction in Industrial and Developing Countries
title_short	Microeconomic Evidence of Creative Destruction in Industrial and Developing Countries
title_full	Microeconomic Evidence of Creative Destruction in Industrial and Developing Countries
title_fullStr	Microeconomic Evidence of Creative Destruction in Industrial and Developing Countries
title_full_unstemmed	Microeconomic Evidence of Creative Destruction in Industrial and Developing Countries
title_sort	microeconomic evidence of creative destruction in industrial and developing countries
publisher	Washington, DC: World Bank
publishDate	2012
url	http://hdl.handle.net/10986/9170
_version_	1764408727730913280

Microeconomic Evidence of Creative Destruction in Industrial and Developing Countries

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