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The Spanish productivity puzzle in the Great Recession

Author

Listed:
  • Laura Hospido

    (Banco de España)

  • Eva Moreno-Galbis

    (GRANEM)

Abstract
While Spain has traditionally underperformed its European peers in terms of labor productivity, the trend reverses after 2007. The evolution of aggregate productivity in Spain during the Great Recession is shaped largely, albeit not exclusively, by the adverse conditions in the labor market. Using a longitudinal sample of Spanish manufacturing and services companies between 1995 and 2012, we show that the recent increase in Spanish aggregate productivity is also responsive to the behavior of total factor productivity (TFP) and to composition effects. By combining the information at firm level on balance sheet items, collective agreements and imports-exports, we are able to establish that a collective agreement at the firm level and access to external markets are positively related to TFP performance during the whole period. In addition, our estimates indicate that firm TFP was negatively correlated to the proportion of temporary workers during the expansionary period, 1995-2007, whereas the sign of that correlation reversed during the crisis, 2008-2012. Finally, we relate this sign reversal to the changing composition of temporary workers in the labor market.

Suggested Citation

  • Laura Hospido & Eva Moreno-Galbis, 2015. "The Spanish productivity puzzle in the Great Recession," Working Papers 1501, Banco de España.
    • Handle: RePEc:bde:wpaper:1501
    as

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    File URL: http://www.bde.es/f/webbde/SES/Secciones/Publicaciones/PublicacionesSeriadas/DocumentosTrabajo/15/Fich/dt1501e.pdf
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    References listed on IDEAS

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    Cited by:

    1. Peter S. Eppinger & Nicole Meythaler & Marc-Manuel Sindlinger & Marcel Smolka, 2018. "The great trade collapse and the Spanish export miracle: Firm-level evidence from the crisis," The World Economy, Wiley Blackwell, vol. 41(2), pages 457-493, February.
    2. Anete Pajuste & Hernán Ruffo, 2017. "Wage rigidity and workers’ flows during recessions," SSE Riga/BICEPS Research Papers 4, Baltic International Centre for Economic Policy Studies (BICEPS);Stockholm School of Economics in Riga (SSE Riga).
    3. Borja Jalón & Simón Sosvilla-Rivero & José A. Herce, 2017. "Countercyclical Labor Productivity: The Spanish Anomaly," IREA Working Papers 201712, University of Barcelona, Research Institute of Applied Economics, revised Jun 2017.
    4. Askenazy, Philippe & Erhel, Christine, 2015. "The French Productivity Puzzle," IZA Discussion Papers 9188, Institute of Labor Economics (IZA).
    5. Román-Collado, Rocío & Colinet, María José, 2018. "Are labour productivity and residential living standards drivers of the energy consumption changes?," Energy Economics, Elsevier, vol. 74(C), pages 746-756.
    6. Cristina Fernández & Aitor Lacuesta & José Manuel Montero & Alberto Urtasun, 2015. "Heterogeneity of markups at the firm level and changes during the great recession: the case of spain," Working Papers 1536, Banco de España.
    7. F. J. Escribá-Pérez & M. J. Murgui-García & J. R. Ruiz-Tamarit, 2017. "Economic and Statistical Measurement of Physical Capital with an Application to the Spanish Economy," LIDAM Discussion Papers IRES 2017020, Université catholique de Louvain, Institut de Recherches Economiques et Sociales (IRES).
    8. Román-Collado, Rocío & Colinet, Maria José, 2018. "Is energy efficiency a driver or an inhibitor of energy consumption changes in Spain? Two decomposition approaches," Energy Policy, Elsevier, vol. 115(C), pages 409-417.
    9. del Río, Fernando & Lores, Francisco-Xavier, 2023. "Accounting for spanish economic development 1850–2019," Economic Modelling, Elsevier, vol. 121(C).
    10. del Río, Fernando & Lores, Francisco-Xavier, 2023. "Accounting for Spanish economic development 1850-2019," MPRA Paper 116025, University Library of Munich, Germany.
    11. Francisco-Javier Escribá-Pérez & María-José Murgui-García & José-Ramón Ruiz-Tamarit, 2022. "The devil is in the details: Capital stock estimation and aggregate productivity growth—An application to the Spanish economy," Portuguese Economic Journal, Springer;Instituto Superior de Economia e Gestao, vol. 21(1), pages 31-50, January.

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    More about this item

    Keywords

    labor productivity; TFP; temporary workers; collective agreements; exporting firms;
    All these keywords.

    JEL classification:

    • J24 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Human Capital; Skills; Occupational Choice; Labor Productivity
    • J21 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Labor Force and Employment, Size, and Structure
    • J52 - Labor and Demographic Economics - - Labor-Management Relations, Trade Unions, and Collective Bargaining - - - Dispute Resolution: Strikes, Arbitration, and Mediation

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