The Cyclicality of Productivity Dispersion

  title={The Cyclicality of Productivity Dispersion},
  author={Matthias Kehrig},
  • Matthias Kehrig
  • Published 2011
Using plant-level data, I show that the dispersion of total factor productivity in U.S. durable manufacturing is greater in recessions than in booms. This cyclical property of productivity dispersion is much less pronounced in non-durable manufacturing. In durables, this phenomenon primarily reflects a relatively higher share of unproductive firms in a recession. In order to interpret these findings, I construct a business cycle model where production in durables requires a fixed input. In a… CONTINUE READING
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