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Structural Change Within versus Across Firms: Evidence from the United States / Xiang Ding, Teresa C. Fort, Stephen J. Redding, Peter K. Schott.
- Format:
- Book
- Author/Creator:
- Ding, Xiang.
- Series:
- Working Paper Series (National Bureau of Economic Research) no. w30127.
- NBER working paper series no. w30127
- Language:
- English
- Physical Description:
- 1 online resource: illustrations (black and white);
- Place of Publication:
- Cambridge, Mass. National Bureau of Economic Research 2022.
- Summary:
- We document the role of intangible capital in manufacturing firms' substantial contribution to non-manufacturing employment growth from 1977-2019. Exploiting data on firms' "auxiliary" establishments, we develop a novel measure of proprietary in-house knowledge and show that it is associated with increased growth and industry switching. We rationalize this reallocation in a model where firms combine physical and knowledge inputs as complements, and where producing the latter in-house confers a sector-neutral productivity advantage facilitating within-firm structural transformation. Consistent with the model, manufacturing firms with auxiliary employment pivot towards services in response to a plausibly exogenous decline in their physical input prices.
- Notes:
- Print version record
- June 2022.
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