Chad Syverson, along with Nick Bloom, John van Reenen, Pete Klenow and many others, has been at the forefront of a really interesting new strand of the economics literature: persistent differences in productivity. Syverson looked at productivity differences within 4-digit SIC industries in the US (quite narrow industries like “Greeting Cards” or “Industrial Sealants”) a number of years back, and found that in the average industry, the 90-10 ratio of total factor productivity plants was almost 2. That is, the top decile plant in the average industry produced twice as much output as the bottom decline plant, using exactly the same inputs! Hsieh and Klenow did a similar exercise in China and India and found even starker productivity differences, largely due a big left-tail of very low productivity firms. This basic result is robust to different measures of productivity, and to different techniques for identifying differences; you can make assumptions…
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