Patterns of Firm-Level Productivity in Ireland

Papa, Javier and Rehill, Luke and OConnor, Brendan (2021): Patterns of Firm-Level Productivity in Ireland. Published in: The Economic and Social Review , Vol. 5, No. 3 (2021): pp. 241-268.

Abstract

Although 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. To identify the determinants behind the aggregate productivity growth in Ireland we use a firm-level panel dataset from the CSO to study productivity patterns and trends distributed by percentile, sector, ownership, as well the efficiency of resource allocation. Our results show a widening of the productivity gap between the most and least productive firms, consistent with cross-country results from the OECD. Results also confirm that aggregate productivity statistics are heavily dominated by a small number of foreign owned firms, leaving Ireland’s productivity prone to firm-specific shocks, while also disguising the performance of domestic sectors and firms. Lastly, allocative efficiency, a key driver of productivity, does not appear particularly strong amongst domestic sectors of the economy.

• Item Type: MPRA Paper
• Language: English
• Keywords: Productivity, Firm-Level, Heterogeneity, Market Concentration, Ireland
• Subjects: L - Industrial Organization > L1 - Market Structure, Firm Strategy, and Market Performance > L11 - Production, Pricing, and Market Structure ; Size Distribution of Firms; O - Economic Development, Innovation, Technological Change, and Growth > O3 - Innovation ; Research and Development ; Technological Change ; Intellectual Property Rights > O38 - Government Policy; O - Economic Development, Innovation, Technological Change, and Growth > O4 - Economic Growth and Aggregate Productivity > O47 - Empirical Studies of Economic Growth ; Aggregate Productivity ; Cross-Country Output Convergence; O - Economic Development, Innovation, Technological Change, and Growth > O5 - Economywide Country Studies > O52 - Europe

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