Firms that lie far behind the technological frontier have the most to gain from imitating the technology or management practices of others. That some firms converge relatively slowly to the productivity frontier suggests the existence of factors that cause them to underinvest in their...

This paper examines the effect of demand on productivity. We exploit the Energy Policy Act of 2005 as a natural experiment which generated plausibly exogenous variation in the capacity of ethanol plants to establish the causal effect of demand on productivity within the corn sector. Using...