Nov 8th, 2021
Understanding productivity: Organisational Capital perspectives
The central theme of this programme of work is the need for greater understanding of heterogeneity, in terms of the drivers of productivity, the types of firms and their particular role in the productivity puzzle. Starting with the premise that there are only three ways of improving firm level productivity in a given environment. These are, to encourage and facilitate the growth of new high productivity firms, to encourage productivity growth in existing firms. We will therefore proceed with analysis of these main themes, of entrepreneurship and small firm growth, innovation and collaboration, internationalisation, inward investment, supply chain coordination and corporate governance.
The international aspects of this theme, focussing on exports and FDI, have at their heart notions of international knowledge transfer and learning, linking to innovation, and understanding of the importance of where international firms choose to locate different activities (and in turn what locations can do to influence this, or to at least understand the process and seek to maximise the benefits for their stakeholders.
Continuing the theme of heterogeneity, we also highlight the heterogeneity in the benefits of exporting, and also the productivity gains through attracting FDI. We also highlight heterogeneity in firm governance, and in supply chains configuration and competitiveness. On the one hand, one could argue that this makes the focal firm more “productive” but too many varying signals simply pass the problem onto others, who may be less well resourced and able to address the problem. Taken together therefore, we set out an agenda that sees much commonality between these themes, and highlights the additionality of exploring these issues together, rather than as disparate strands of very different literatures, as has been the case hitherto.
This paper is part of a series of working papers outlining the key issues and questions of The Productivity Institute’s key research themes. This paper covers the Organisational Capital research theme. Other papers will provide an overview of Human capital, Knowledge Capital, Institutions & governance, Macroeconomic trends & policy, Measurements & methods, Geography & place and Social, environmental & technological transitions.
Authors Nigel Driffield, Jun Du, Jan Godsell, Mark Hart, Katiuscia Lavoratori, Stephen Roper, Irina Surdu, Wanrong Zhang