The joint dynamics of capital and employment at the plant level

摘要: While a great deal of research has studied the adjustment individual factors production, relatively little work investigated their joint dynamics at plant level. The present paper uses plant-level data from two countries to document capital and employment. are analyzed through lens model costly multi-factor that integrates features canonical models dynamic labor demand. places strong restrictions on dynamics, namely, investment ought perfectly predict employment growth. In contrast, 42 percent gross accumulation occurs plants (in years) which record losses.The then discusses number extensions baseline model, including delivery lags, alternative costs, standard factor-biased technical change. These do not provide satisfactory accounts data. most promising extension is one in production function modi…ed enable machinery directly replace certain tasks. concludes by illustrating macroeconomic implications its …ndings.