The conventional wisdom is that the rising productivity in the U.S. manufacturing sector in the 1980s has been driven by the apparently pervasive downsizing over this period. Aggregate evidence clearly shows falling employment accompanying the rise in productivity. In this paper, we examine the microeconomic evidence using the plant level data from the Longitudinal Research Database (LRD).
Downsizing and Productivity Growth: Myth or RealityMartin Baily, Eric Bartelsman, and John C. Haltiwanger ,
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Small Business Economics