Productivity of Slovenian
firms
Polona Domadenik, PhD
University of Ljubljana, Faculty of Economics
Bojan Ivanc, CFA, CAIA
Chamber of Commerce & Industry of Slovenia
Denis Marinšek, PhD, CFA
University of Ljubljana, Faculty of Economics
Motivation – Governance and
Institutional Context
• Privatization model in 90s favored internal owners
(employees and managers)
• efficient in SME , diversified ownership in big firms
• State as an (in)efficient owner before and during the crisis
• Period of 2004-2008
• riskier investments in private firms
• ownership consolidation in firms with diversified owners
• Deleveraging following 2009 and growth after 2014
• Structural weaknesses within the regulatory system
• The role of state aid (different types of subsidies)
before and after the crisis
Aim of the study
Analyze the
difference in
productivity by:
• firm‘s size
• type of ownership
• investment and R&D
activities
• industry characteristics
• internationalization
Data
• Firms’ annual financial statements – AJPES database 19952015
• Government subsidy allocation data – Ministry of Finance
• Ownership structure gathered in several previous surveys
Methodology
1.TFP calculated as the residual from the production
function (Levinsohn – Petrin procedure)
2.Dynamic production function estimation
Results – all firms
Results – all firms
TFP in four different industries
Results – all firms
TFP according to export
Results – state owned vs others
TFP growth in state owned firms vs other firms
Results – different owners
TFP according to more detailed ownership structure
What are factors that generate
differences among firms?
Before crisis
R&D activity ***
Foreign owners ***
Privatizatized firms ***
After crisis
Investment**
R&D activity **
State owners *
Subsidies**
Conclusions
• Outperforming factors:
• Size (large to medium)
• Export orientation
• R&D activity
• Before crisis foreign owned firms and de-novo firms were
more productive if compared with others.
• After 2009 investment and R&D activity was important for
productivity growth, while subsidies represented surviving factor
for firms in financial difficulties. State owned firms reported
lower productivity during the crisis.
• Zombie firms represented higher share in total structure as
reported by OECD study (McGowan e tal, 2017).