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Working Paper
Scalable vs. Productive Technologies
Do larger firms have more productive technologies or are their technologies more scalable, or both? We use administrative data on Canadian and US firms to estimate flexible nonparametric production functions. Our estimation results in a joint distribution of output elasticities of capital, labor, and intermediate inputs---therefore, returns to scale (RTS)---along with total factor productivity (TFP). We find significant heterogeneity in both RTS and TFP across firms. Larger firms operate technologies with higher RTS, both across and within industries. Higher RTS for large firms are entirely ...
Working Paper
Scalable versus Productive Technologies
CORRECT ORDER OF AUTHORS: Hubmer, Chan, Ozkan, Salgado, Hong. Do larger firms have more productive technologies, are their technologies more scalable, or both? We use administrative data on Canadian and US firms to estimate a joint distribution of output elasticities of capital, labor, and intermediate inputs—thus, returns to scale (RTS)—along with total factor productivity (TFP). We find significant heterogeneity in RTS across firms within industries. Furthermore, larger firms operate technologies with higher RTS, whereas the largest firms do not exhibit the highest TFP. Higher RTS for ...