A Structural Model of Establishment and Industry Evolution : Evidence from Chile

Şeker, Murat

关键词: DATA ANALYSIS;    DEVELOPMENT RESEARCH;    EXPENDITURE;    EXPERIMENTS;    FINANCIAL MARKETS;   

DOI  :  10.1596/1813-9450-4947
RP-ID  :  WPS4947

学科分类：社会科学、人文和艺术（综合）

来源: World Bank Open Knowledge Repository

【 摘 要 】

Many recent models have been developedto fit the basic facts on establishment and industryevolution. While these models yield a simple interpretationof the basic features of the data, they are too stylized toconfront the micro-level data in a more formal quantitativeanalysis. In this paper, the author develops a model inwhich establishments grow by innovating new products. Byintroducing heterogeneity to a stylized industry evolutionmodel, the analysis succeeds in explaining several featuresof the data, such as the thick right tail of the sizedistribution and the relations between age, size, and thehazard rate of exit, which had eluded existing models. Inthe model, heterogeneity in producer behavior arises througha combination of exogenous efficiency differences andaccumulated innovations resulting from past endogenousresearch and development investments. Integrating theseforces allows the model to perform well quantitatively infitting data on Chilean manufacturers. The counterfactualexperiments show how producers respond to research anddevelopment subsidies and more competitive market environments.