

Weekly Thoughts: Productivity Differentials
Here is something that caught our eye this week: Productivity Differentials One of the things we love about our work is seeing how academic theory translates into business reality in real-time. For example, several researchers have sought to explain differing operational and financial performance across businesses in the same industry or of the same size. As research conducted in 2004 by University of Chicago Professor Chad Syverson explains: "...'within 4-digit SIC [Standard Industrial Classification] industries in the U.S. manufacturing sector, the average difference in logged total factor productivity (TFP) between an industry’s 90th and 10th percentile plants is 0.651 ... [meaning that] the plant at