OECD Productivity Working Papers

The OECD Productivity Papers are associated with the Global Forum on Productivity that provides a forum for mutual exchange of information and fosters international co-operation between public bodies with responsibility for promoting productivity-enhancing policies, including in undertaking joint policy analysis. It offers a platform for exchanging views, experiences and information, institutional and governance arrangements and government structures, with a view towards developing better policies. The Forum extends existing work in the OECD through a well-prioritised and coherent stream of analytical work serving the policy research needs of participants on the drivers of productivity growth.


Patterns of firm level productivity in Ireland

Productivity is the ultimate driver of sustainable increases in living standards. While Ireland is a high productivity country, it has not been immune from the global productivity slowdown, with the pace of growth on a downward trend throughout the 2000s. Little research has been carried out as to the determinants behind the productivity slowdown in Ireland, and even less so with microdata. To fill the gap, we use a firm-level panel dataset based on production surveys from Ireland’s national statistics office, together with the OECD MultiProd model, in order to identify productivity patterns and trends distributed by percentile, sector, ownership, as well as measures of the efficiency of resource allocation. Our results show a widening of the productivity gap between the most and least productive firms, with the majority of firms experiencing a decline in productivity since the mid-2000s, and also confirm that aggregate results are driven by the impact of foreign dominated sectors, with foreign firms typically larger and more productive. These results are significant in terms of enterprise policy and featured prominently in the OECD’s 2018 Economic Survey of Ireland.


Keywords: productivity distribution, MultiProd, labour productivity, Firm level productivity, resource allocation, multifactor productivity, productivity dispersion, productivity frontier
JEL: O30: Economic Development, Innovation, Technological Change, and Growth / Innovation; Research and Development; Technological Change; Intellectual Property Rights / Innovation; Research and Development; Technological Change; Intellectual Property Rights: General; F23: International Economics / International Factor Movements and International Business / Multinational Firms; International Business; O57: Economic Development, Innovation, Technological Change, and Growth / Economywide Country Studies / Comparative Studies of Countries; M13: Business Administration and Business Economics; Marketing; Accounting; Personnel Economics / Business Administration / New Firms; Startups; O40: Economic Development, Innovation, Technological Change, and Growth / Economic Growth and Aggregate Productivity / Economic Growth and Aggregate Productivity: General
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