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Welcome to the Productivity Partnership's winter newsletter!
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NEW PROJECTS


Since the start of the Partnership, we have funded 27 research projects with more coming on a regular basis.

The following are some of the projects that have been approved for funding since our previous newsletter.
Title: Learning, Employment Match Quality, and Business Turnover
Researchers: Dr. Shutao Cao (Victoria University of Wellington)
 
This project investigates to what extent individual learning/experience and employment match quality affect firm creation (new entrepreneurship) and firm survival. Learning and experience is a proxy for the quantity of entrepreneurial human capital, and employment match quality is a proxy for the quality of such human capital. New entrepreneurship as an occupational choice is the outcome of accumulation of the entrepreneurial human capital, meanwhile, this human capital as an initial condition may also affect the firm exit decision. To this end, we incorporate learning/experience and employment match quality into a dynamic model of occupational choice (i.e., switching between being an employee and being a business owner) using the matched employee-employer data CEEDD. The project also offers insights on the relative importance of financial wealth and entrepreneurial human capital in business formation.
 
Datasets: Canadian Employer-Employee Dynamics Database (CEEDD)
 

Title: The Labour Market Risks of Entrepreneurship 
Researchers: Gueorgui Kambourov (University of Toronto), Burhan Kuruscu (University of Toronto), and Baxter Robinson (University of Toronto)
 
Starting a business is risky because many businesses fail. Unsuccessful entrepreneurs may lose some of the money they invest, they may lose income by giving up a job in order to start the business, and after their business fails, they may not be able to find as high-paying a job as they had before. How important are these different losses for Canadian entrepreneurs? This project seeks to understand how these different risks discourage people with good ideas from starting businesses. By better understanding these risks, we can create public policy to more effectively encourage people to become entrepreneurs.
 
Datasets: Canadian Employer-Employee Dynamics Database (CEEDD)
 

Title: Global Income Dynamic Database Project: Canada
Researchers: Dr. Audra Bowlus (Western University), Dr. Lance Lochner (Western University), Dr. Youngmin Park (Bank of Canada), and Emilien Gouin-Bonenfant (University of California San Diego)

The goal of the Global Income Dynamics Database Project is to provide a rich set of statistics on individual income dynamics for several countries, which are harmonized to make them comparable. The key difference between this project and others (for example, the World Income and Wealth Database of Piketty-Saez-Zucman, et al.) is the focus on dynamics (which requires longitudinal data rather than repeated cross-sections), and administrative data (which allows more sophisticated analyses with reduced measurement issues). This project will enable Canada to be a participant in this database along with 10 other countries (Brazil, Denmark, France, Germany, Italy, Mexico, Norway, Sweden, UK, and US). Canada is uniquely positioned to participate given the newly formed matched worker-firm panel data.

Datasets: Canadian Employer- Employee Dynamics Database (CEEDD)

Unsure what is possible using CDER datasets?

Explore the presentation 'Exploring Research Opportunities through the Productivity Partnership' to find out what is possible.

We've created an interactive online presentation on how to utilize the Productivity Partnership to access data at the Statistics Canada Centre for Data Development and Economic Research (CDER). The presentation outlines each data set’s highlights and explains the application processes for both the Partnership and CDER. This project is targeted primarily toward prospective applicants and website viewers, but is designed to be informative and accessible to all audiences. 

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Have an idea for a project on productivity?

 
 Visit our website to learn more about how to apply for project funding.

UPCOMING EVENTS

Canadian Economics Association Annual Meeting 
May 31 – June 2 | University of Calgary, Banff AB
 
Data School Sessions
The Productivity Partnership Partnership is hosting two data school sessions. In the first session, Dr. Beryl Li, Productivity Partnership Statistics Canada Liaison Researcher, will discuss the microdata that is available at CDER/Statistics Canada. In the second session, researchers whose projects have been funded by the Partnership, will present their research.

Productivity Partnership - Data School:  An Overview and Statistics Canada Business Microdata
Time | Sunday, June 2, 2019 | Location TBA
  • Speaker: Jiang Beryl Li (Statistics Canada)
  • Topic: An Overview and Statistics Canada Business Microdata
Productivity Partnership - Data School: CDER Researcher Session
Time | Sunday, June 2, 2019 | Location TBA
  • John Lester (University of Calgary): Do Returns to R&D Vary by Size of Firm? Evidence from Canada
  • Jahangir Alam (HEC Montréal): Price Dispersion and Trade Policy
  • Peter Morrow (University of Toronto): Working with the Linked T2-LEAP Data Set
 

2019 Partners Meeting in Ottawa: Advances in the Study of Productivity 
April 30 | Ottawa 

The Partnership has co-organized an event with the Bank of Canada and Innovation Science and Economic Development Canada in Ottawa on April 30. 

The event is by invitation but a number of spots have been designated for the Partnership: please email Mike Veall (veall@mcmaster.ca) if you would like to be invited.

In addition, some travel funds are available for students that would like to participate. 
 

PAST EVENTS

CRDCN 2018 National Conference
October 18 – 19, 2018 | McMaster University, Hamilton ON

This year, the 2018 annual CRDCN National Conference was organized by the McMaster Statistics Canada Research Data Centre (RDC). The theme for this year’s conference was: “Building an Inclusive, Prosperous and Healthy Canada: What Can We Learn from the Data?” Researchers presented on topics such as immigration, income and employment, education, and population health. Mike Veall, Partnership Director, served as the Chair of the Organizing Committee. The Productivity Partnership was also one of the co-sponsors for this event.
 
The following Partnership associates presented at the conference:

 
  • Byron Spencer (McMaster University, Partnership co-investigator): Age-Income Dynamics Over the Life Course: Cohort Transition Patterns Based on Canadian Tax Returns.
  • Miguel Cardoso, (Brock University, Partnership collaborator): Immigrants and Exports: Firm-level Evidence from Canada.
  • Jahangir Alam (HEC Montréal / Statistics Canada, Partnership Post Doctoral Fellow): Misallocation and Trade Policy.
  • Daniela Scur (Massachusetts Institute of Technology, Partnership collaborator): Measuring Management
  • Benoit Dostie (HEC Montréal, Partnership co-investigator): Canadian Immigrants and Training Opportunities: Evidence from Canadian Linked Employer-Employee Data
A selection of presentations are available on the CRDCN website.
 

QICSS International Conference 2018: Immigration’s Impact, Immigrants’ outcomes: New Results Using Business & Social Data 
October 11 – 12, 2018 | HEC Montréal, Montréal QC  

Every two years, the Quebec Interuniversity Center for Social Statistics (QICSS) organizes an international conference. This year, the conference was titled: “Immigration’s Impact, Immigrants’ Outcomes: New Results and Using Business and Social Data.” David Card (University of California, Partnership research associate) was one of the keynote speakers.
 
The following Partnership associates presented at the conference:
  • Mohsen Javdani (University of British Columbia, Partnership collaborator): Canadian Immigrants and Training Opportunities: Evidence from Canadian Linked Employer-Employee Data.
  • Daniel Parent (HEC Montréal, Partnership co-investigator): Immigrant Careers and Networks.
  • Ananth Ramanarayanan (Western University, Partnership co-investigator): Immigrants and Exports: Firm-level Evidence from Canada.
The conference was organized by QICSS and the Productivity Partnership, in collaboration with the Canadian Research Data Centre Network (CRDCN), the Center for Interuniversity Research and Analysis of Organization (CIRANO) and HEC Montréal.
 
To see more detail about the conference check out the website or conference program.
 

NEW WORKING PAPERS


Our website has a number of working papers, presentations, journal articles, and commentary.
Capital Misallocation: Cyclicality and Sources
M. Jahangir Alam (HEC Montréal / Statistics Canada)

 
Capital misallocation can lower aggregate total factor productivity, but much less is known about its cyclicality. In this study, I use European firm-level data to establish that capital misallocation, as measured by the dispersion of capital returns, is higher during recessions and lower during booms. I also estimate that more than 50 percent of capital misallocation is due to variations between firms within industries. Furthermore, my results show that the net worth of medium-sized firms explains seven percent of the capital misallocation within industries and one-quarter of its cyclicality. This finding suggests financial frictions may play a role.

 

Immigrants and Exports: Firm-level Evidence from Canada
Miguel Cardoso (Brock University), Ananth Ramanarayanan (University of Western Ontario)

 
Firms face considerable informational barriers to engaging in international trade. Immigrants can play a key role in overcoming these barriers by acting as intermediaries between firms in their home and host countries, thus facilitating trade. Previous studies have shown that this trade-creation effect of immigrants is significant at the aggregate level: e.g. Portuguese immigrants to Canada raises Canada’s exports to Portugal. In this paper, we examine the trade-creation effect of immigrants at the firm level: how much Portuguese immigrants employed by Canadian firms increase those firms’ exports to Portugal. We use unique administrative employer-employee matched data containing Canadian manufacturing firms’ export transactions and employees’ immigration records to estimate how much immigrant employees reduces a firm’s costs of exporting to their home countries.

 

NEWS


Below is a selection of Partnership news.
New Positions

Karen Ugarte Bravo has recently completed an internship position at the Inter-American Development Bank in Washington, DC. Karen is a McMaster Economics PhD candidate and received a research assistantship from the Partnership. Congratulations Karen!
Awards

University of Calgary Economics PhD candidate, Akio Yamazaki, was awarded the Lasserre-Renzetti Prize for the best student paper at the 2018 Canadian Resources and Environmental Economics annual meeting. His paper, “Environmental Tax Reform and Productivity: Lessons from Canadian Manufacturing,” was supported by the Productivity Partnership. Akio is the first ever recipient of this prize, congratulations!  
New Grants

The project, "Employer Perceptions to Hiring Newcomers and International Students in Newfoundland and Labrador," has received funding from the Newfoundland and Labrador Workforce Innovation Centre ($238,932) and the Atlantic Canada Opportunities Agency ($59,251). Congratulations to co-investigator Dr. Tony Fang of the Department of Economics, Memorial University of Newfoundland, and his team of researchers!
Journal Articles

Congratulations to the following Partnership associates on their recent publications:
 
Exchange Rates, Cross-Border Travel, and Retailers: Theory and Empirics
Journal of International Economics.

 
Loretta Fung, (National Tsing Hua University, Productivity Partnership Collaborator)
Jenn Baggs, (University of Victoria)
Beverly Lapham (Queen’s University)

 
This paper provides a theoretical and empirical analysis of the effects of nominal exchange rate movements on retail firms' sales, emphasizing the role of cross-border travel by consumers. We develop a search-theoretic model of price-setting heterogeneous retailers and traveling consumers who face nominal exchange rate shocks. These shocks affect retailers on the supply side, through imported input prices, and on the demand side, via their effect on the propensity for consumers to cross the border and shop at foreign retail stores. We use Canadian retailer and traveler data from 1986 to 2007 to estimate the model. Consistent with the model, the empirical results indicate that an appreciation of the Canadian dollar substantially increases Canadians' cross border travel which has a significant negative effect on the sales of Canadian retailers. These effects diminish with the distance to the nearest US shopping destination, relative population and the median income of the community in which the retailer operates. Using counterfactual experiments, we quantify the positive effects on Canadian retailers' sales of more restrictive border controls after September 2001, and the negative effects on those sales of increased Canadian duty-free allowances and the expansion of US shopping opportunities. This paper was partially supported by the Productivity Partnership.

  

Integration and Retention of Refugees in Smaller Communities
International Migration


Tony Fang, (Memorial University of Newfoundland, Partnership co-investigator)
Halina Sapeha (Memorial University of Newfoundland)
Kerri Neil (Memorial University of Newfoundland)

 
While advanced economies attempt to pursue a regionalized immigration policy, which aims at shifting migration flows away from the most popular urban centre destinations to smaller communities, the experiences of immigrants settling in such locations remains underexplored. This research provides timely knowledge of refugee labour market integration in smaller communities, using Newfoundland and Labrador's provincial capital, St. John's, as an example of such communities. The article examines the resettlement and labour market integration of refugees in a medium‐sized city with particular attention to factors that enhance refugee labour market integration and factors that negatively impact refugee integration and their retention in the receiving community. The study finds that the negative perception of employment opportunities is a significant factor in refugee's decision to move. Securing employment of refugees is facilitated by strong English language skills, social connections and is hampered by discrimination in the labour market. Dr. Tony Fang is one of the Partnership’s co-investigators.

 
Media

Mike Veall, Partnership Director, discusses the Sears (U.S.) bankruptcy on CHML. The segment can be found here: “U.S. Sears has filed for a Chapter 11 bankruptcy. What does this mean for the American big box store? Is it done for?” 
 
Greig Mordue, Partnership co-investigator, was interviewed by the Globe and Mail for an article about the future of the Canadian auto industry. The piece can be found here: “Canada’s auto sector still has a few miles left, experts say.”
 
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