Recent research using establishment-and firm-level data has raised a variety of conceptual and measurement questions regarding our understanding of aggregate productivity growth. 1 Several key related findings are of interest.First, there is large-scale, ongoing reallocation of outputs and inputs across individual producers.Second, the pace of this reallocation varies over time (both secularly and cyclically) and across sectors.Third, much of this reallocation reflects within-rather than betweensector reallocation.Fourth, there are large differentials in the levels and the rates of growth of productivity across establishments within the same sector.The rapid pace of output and input reallocation along with differences in productivity levels and growth rates are the necessary ingredients for the pace of reallocation to play an important role in aggregate (i.e., industry) productivity growth.However, our review of the existing studies Lucia Foster is an economist at the Bureau of the Census.
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