Do firms have the right incentives to innovate in the presence of productivity spillovers? This paper proposes an … explicit model of spillovers through labor flows in a framework with search frictions. Firms can choose to innovate or to …-term wage contracts with their workers, productivity spillovers are fully internalized. If firms cannot commit to long-term wage …

States in terms of unemployment, productivity growth and wage inequality. To show this, we construct two fictitious economies … productivity grows less due to larger mismatch. The model can be used to address a number of normative issues. …

Economic development implies that the efficiency of firms in developing countries is approaching that of firms in … privatization, competition and foreign investment. We also test hypotheses positing that only firms near the efficiency frontier … find that privatization to domestic owners did not markedly improve the efficiency of firms; domestic firms are not …

A firm's productivity depends on how production is organized given the level of demand for its product. To capture this … mechanism, we develop a theory of an economy where firms with heterogeneous demands use labor and knowledge to produce … theory, heterogeneity in demand leads to heterogeneity in productivity and other firms' outcomes. We use the theory to …

Using a stochastic frontier model and a comprehensive dataset, we study factors that affect corporate efficiency in … efficiency, and (iii) high competition is less conductive to efficiency than moderate or low competition. In terms of ownership …, we find that (iv) efficiency increases when a majority owner must deal with minority shareholders and that (v) domestic …