Multiproduct Firms, Firm Dynamics, and the Productive Mix of Brazilian Manufacturing Firms
Abstract This paper studies the Brazilian manufacturing sector in line with the literature on heterogeneous firm. We focus i) on the characteristics of firms that are multi-product (MP), multi-sector and multi-industry; and ii) on the analysis of their scope, including the determinants of product switching, behavior over business cycle, and relation with several firm's characteristics. MP corresponds to 37% of all manufacturing firms, but generates 81% of the output. They employ more workers, are more likely to be exporters, have higher labor productivity and higher TFP. The extensive margin due to adding and retirement of products contributes more to output growth than entry and exit of firms. All margins are positive correlated to GDP growth: the intensive margin has an almost perfect correlation, followed by the product margin, with values around 0.91, and then by firm's margin, with correlations around 0.60. When restricting the study to continuing firms, it was found that half of the annual output growth (from 2005 to 2009) was originated by firms that switched products. Those that have net added (dropped) items had higher (smaller) increase in output, in employees, and in the TFP. Having higher TFP, more employees, or being an exporter increase the probability of only adding or only dropping items in the future.
| Main Authors: | , |
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| Format: | Digital revista |
| Language: | English |
| Published: |
Departamento de Economia
2018
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| Online Access: | http://old.scielo.br/scielo.php?script=sci_arttext&pid=S0101-41612018000300349 |
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