Giuseppe Berlingieri, Sara Calligaris, Chiara Criscuolo, 19 September 2018

The evidence that bigger firms pay higher wages and have higher productivity is mainly based on manufacturing, which nowadays accounts for a small share of the economy. Drawing on a unique micro-aggregated dataset, this column reveals that while the size premia for both wages and productivity are significantly weaker in market services than in manufacturing, the link between wages and productivity is stronger – the most productive firms at the top are not necessarily the largest ones in terms of employment, but they do pay the best. This increases the likelihood of productivity and wage gains being shared with fewer workers, a further challenge to achieving inclusive growth in the new service economy.

Tatiana Didier, Ross Levine, Sergio Schmukler, 25 August 2015

It is still not clear which firms issue equity and bonds, what happens to their assets, sales, and employment, and how the performance of issuers compares to that of non-issuers. This column addresses these three questions. First, only a small number of large firms issue securities in a typical country. Second, issuers grow faster than non-issuers in terms of assets, sales, and employment. Third, smaller issuing firms grow faster than larger ones, but larger non-issuing firms grow faster than smaller ones.

Ramon Xifré, 12 September 2014

As the most acute phase of the Eurozone crisis is over, the current-account balances of France, Italy, and Spain have improved. This column warns against complacency about this improvement, pointing at some structural factors that impede growth and damage competitiveness. Resources should be relocated towards the tradeable sectors and to those firms most prepared to grow and compete. If not, these three countries are likely to aggravate the dysfunctional duality of their economies.

Ajay Agrawal, Iain Cockburn, Alberto Galasso, Alexander Oettl, 23 December 2013

Many regions struggle to attract innovation activity. This column discusses new evidence suggesting that there is no universal ‘best’ policy. Policies focused exclusively on attracting ‘anchor tenants’ or cultivating new ventures may not be as effective as those promoting a mix of large and small firms. Regions with large firms but few young entrepreneurial firms may benefit from policies that cultivate new ventures, while those without large firms may benefit most from policies that attract some.

Serguey Braguinsky, Lee Branstetter, André Regateiro, 10 September 2011

Portugal was the third member to join the unenviable club of bailed-out Eurozone countries. This column explores one of the central weaknesses of the Portuguese economy – its low productivity. It finds that this is in part the result of the shrinking size of Portugal’s companies, which is in turn caused by distortions in its labour market that need to be fixed.

László Halpern, 01 July 2011

László Halpern of the Institute of Economics of the Hungarian Academy of Sciences talks to Viv Davies about a forthcoming report on the impact of the crisis on European business. The report finds considerable heterogeneity across countries and firms - for example, exporters contracted more than non-exporters, while importers suffered less of a decline - and highlights the policy trade-off between the benefits of export-oriented strategies versus outsourcing. The interview was recorded in Nottingham on 7 June 2011. [Also read the transcript.]

Gianmarco Ottaviano, 27 August 2010

Gianmarco Ottaviano of Bocconi University talks to Viv Davies about 'The Global Operations of European Firms', a report that analyses data on 15,000 firms in seven countries to show that firm size, productivity, skill intensity and the ability to innovate are associated with better export performance, foreign direct investment and outsourcing. He argues that firms can improve their competitiveness within the European single market, but competing effectively in the future will require more than just exporting to neighbouring EU countries. The interview was recorded in Rome on 19 June 2010.

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