The remainder of this paper is divided into four sections. This result is consistent across all of our methodologies for calculating productivity. The second part of this paper finds that on average, foreign firms are significantly more productive than domestic firms in the markets where they operate. Specifically, the Orbis database provides information on firm ownership, which can be used to distinguish between domestic firms and foreign-owned affiliates in a particular market. The productivity measures computed from our dataset are also useful in demonstrating firm heterogeneity within a country and sector. Of the methodologies considered, labor productivity provides the best coverage: from 2012 to 2016, 49 countries in our data report total revenue and employment data for at least 30 firms per two-digit sector, while the Levinsohn-Petrin method for estimating total factor productivity (TFP), which requires data on intermediate inputs, had the lowest country coverage at only 27 countries in our sample.
Since different measures of productivity require different financial variables, such as assets or depreciation, country coverage varies by the method choosen to calculate or estimate productivity. In order to evaluate the advantages and shortcomings of Orbis for productivity analysis, we document our data coverage by country and two-digit NACE sector, and discuss the variety of productivity measures that can be applied to our dataset. Our purpose in this paper is to demonstrate the usefulness of firm-level data from the Orbis database by constructing and analyzing measures of firm productivity at the country- and sector-level for both manufacturing and services sectors. One significant hurdle impeding this research endeavor, however, is finding readily accessible databases that cover a large set of countries, industries, and firms, allowing for meaningful analysis of firm productivity dynamics across countries and sectors. This stylized fact has led to a renewed focus in the trade literature on measuring productivity, at the sector- or firm-level, in an accurate and consistent manner. Theoretical and empirical work have shown that the productivity of a country’s firms is an important factor in determining its place in the global economy, as a country’s most productive firms are more likely to become exporters (Melitz 2003). In every type of productivity calculation employed in this analysis, foreign firms are significantly more productive than their domestic counterparts. This paper also compares the average productivity of the same sector across countries and the average productivity of domestic and foreign owned firms in the same sector. We find that conditional on the productivity measure employed, country and sector coverage can vary widely in the Orbis database due to different national reporting requirements across countries. Office of Economics Working Paper 2018-07-AĪ five-year panel of cross-country data for 2012-2016 drawn from the Orbis database is used to evaluate the advantages and shortcomings of this data source in calculating firm level productivity. Saad Ahmad, Sarah Oliver, and Caroline Peters Using Orbis to compare productivities across countries and sectors: possibilities and challenges
Orbis company data professional#
Working papers are circulated to promote the active exchange of ideas between USITC Staff and recognized experts outside the USITC and to promote professional development of Office Staff by encouraging outside professional critique of staff research. International Trade Commission or any of its individual Commissioners. These papers are not meant to represent in any way the views of the U.S. Office of Economics working papers are the result of ongoing professional research of USITC Staff and are solely meant to represent the opinions and professional research of individual authors. USING FIRM-LEVEL DATA TO COMPARE PRODUCTIVITIES ACROSS COUNTRIES AND SECTORS: POSSIBILITIES AND CHALLENGES
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