Essays in Honour of Paul A. David
Edited by Cristiano Antonelli, Dominique Foray, Bronwyn H. Hall and W. Edward Steinmueller
Cristiano Antonelli, Chiara Franzoni and Aldo Geuna
Cristiano Antonelli, Francesco Crespi and Giuseppe Scellato
This chapter analyses the dynamics of path dependence, exploring the determinants of the persistence of firm productivity, here measured by total factor productivity (TFP). It highlights the crucial role of the interplay between the internal characteristics of companies, including their size and management strategies, and system properties such as access conditions to local pools of knowledge and the dynamics of economic activity in assessing the dynamics. Analysis of transition probability matrices (TPMs) and econometric analysis provide substantial evidence of the relevance of the mix of individual and systemic factors in shaping persistence as a path-dependent process in which events that take place along the process affect its direction and the pace of productivity dynamics.