This paper aims to contribute to the debate on the determinants of differentials in firms’productivity. We test the hypothesis that macro factors, especially the quality of local institutions,play a central role in explaining firm productivity in Italy. To this end, we construct measures of TotalFactor Productivity for about 4,000 firms by means of different estimation techniques, and a province level index of institutional quality. Then, we estimate the relationship between institutional qualityand firm-level TFP. Our results show that the existence of better local institutions might help firms to become more productive.
Firm productivity and istitutonal quality. Evidence from italian industry
NIFO SARRAPOCHIELLO A;
2015-01-01
Abstract
This paper aims to contribute to the debate on the determinants of differentials in firms’productivity. We test the hypothesis that macro factors, especially the quality of local institutions,play a central role in explaining firm productivity in Italy. To this end, we construct measures of TotalFactor Productivity for about 4,000 firms by means of different estimation techniques, and a province level index of institutional quality. Then, we estimate the relationship between institutional qualityand firm-level TFP. Our results show that the existence of better local institutions might help firms to become more productive.File in questo prodotto:
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