We consider a tractable model of heterogeneous production units that features endogenous entry and productivity … standard factor misallocation framework, policy distortions featuring a positive productivity elasticity of distortions imply … larger reductions in output through smaller investments in establishment productivity. A calibrated version of the model …

Productivity varies widely between industries and countries, but even more so across individual firms within the same … productivity and policies designed to promote the reallocation of resources towards firms that could use them more effectively. The …, established some 10 years ago among major European institutions and a number of EU productivity boards, National Central Banks …