Working Paper Series

Do Very Large Producers Contribute to the Canada-U.S. Productivity Gap?
Evidence from Manufacturing

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Abstract

The existence of a significant difference in the underlying productivity performance of very large producers versus other producers could have wide-reaching implications for the effectiveness of policies designed to improve Canada's productivity performance. This paper examines the productivity performance of plants with 1000 employees or more and determines what contribution this size advantage affords to Canada's relatively weak labour productivity performance in the manufacturing sector. Using Annual Surveys of Manufacturers, the study shows that very large plants in Canada are on average as productive as very large plants in the United States (U.S.) and do not contribute to the Canada-U.S. manufacturing labour productivity gap.