Firm-level Productivity Research in Canada: Current State and Future Directions

The exit rate for a year is defined as the number of exits as a per cent of the average of the number of active employer businesses in the current year and the previous year. [...] The net entry rate for a year is defined as the number of net entry (the number of entrants – the number of exits) as a per cent of the average of the number of active employer businesses in the current year and the previous year. [...] Gu and Lafrance (2014) study the dynamics of the rapid labour productivity growth in the Canadian broadcasting and telecommunications industry since the mid-1980s and find that the productivity growth within firms driven by technical change and scale economies was the main contributor to the aggregate productivity growth for the industry. [...] Analysis of the differences in characteristics between low productivity and high productivity firms can lead to the identification of the reasons for the better performance of the latter and this knowledge may be useful for the development of programs and policies to improve the performance of the former. [...] In addition, the impact of policies on productivity in an industry can be conditioned and influenced by the characteristics of the firms in that industry and the distribution of the characteristics.