The authors apply the analysis of Hsieh and Klenow (2009) to assess the degree of resource misallocation in the Republic of Korea manufacturing sector from 1982 to 2007. They find improvement in the aggregate allocative efficiency during the first decade and a strong reversal after 1992. This...

We analyze the causal impact of the industrial policy structure on the formation of zombie firms, using a rich data set of manufacturing firms in China between 1998 and 2007. We find that selective industrial policy schemes increase zombie shares in skill intensive sectors, because as subsidized...

This paper argues that regional variation in the efficiency of labor allocation among German manufacturing plants plays a critical role in explaining regional disparities in productivity. In fact, we show that over 50% of the East-West productivity gap is associated with a less efficient labor...

The Chilean economy experienced a decade of sustained growth in aggregate out-put and productivity after the 1982 financial crisis. This paper analyzes the effects of resource misallocation on total factor productivity (TFP) of the manufacturing sector by applying the methodology of Hsieh and...

This paper quantifies the degree of factor misallocation across the productivity spectrum of Chinese manufacturing firms and confirms the inadequate allocation of resources to high-productivity firms. This misallocation is only partially proxied by private versus state ownership status. The...

Recent empirical studies document that the level of resource misallocation in the service sector is significantly higher than in the manufacturing sector. We quantify the importance of this difference and study its sources. Conservative estimates for Portugal (2008) show that closing this gap,...

It is well established that mis-allocation of factor resources lowers productivity. In this paper, I use data from both formal and informal firms to study distortions in input and output markets as sources of mis-allocation in the Indian manufacturing sector. My work extends the seminal work of...