Bernard, Andrew B., Dhyne, Emmanuel, Magerman, Glenn, Manova, Kalina and Moxnes, Andreas (2022) The origins of firm heterogeneity: a production network approach. Journal of Political Economy, 130 (7). 1765 - 1804. ISSN 0022-3808
Full text not available from this repository.Abstract
We explore firm size heterogeneity in production networks. In comprehensive data for Belgium, firms with more customers have higher total sales but lower sales and lower market shares per customer. Downstream factors, especially the number of customers, explain the vast majority of firm size dispersion. We rationalize these facts with a model of network formation and two-dimensional firm heterogeneity. Higher productivity generates more matches and larger market shares among customers. Higher relationship capability generates more customers and higher sales. Model estimates suggest a strong negative correlation between productivity and relationship capability and potentially large welfare gains from improving relationship capability.
| Item Type: | Article |
|---|---|
| Official URL: | https://www.journals.uchicago.edu/journal/jpe |
| Additional Information: | © 2022 The University of Chicago |
| Divisions: | Centre for Economic Performance |
| Subjects: | H Social Sciences > HD Industries. Land use. Labor H Social Sciences > HC Economic History and Conditions |
| Date Deposited: | 19 May 2022 11:00 |
| Last Modified: | 12 Dec 2024 03:01 |
| URI: | http://eprints.lse.ac.uk/id/eprint/115151 |
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