GROWTH AND SLOWDOWN OF TFP IN ITALIAN MANUFACTURING BEFORE THE 2008 CRISIS

This paper presents a firm-level analysis of Total Factor Productivity (TFP) using balance sheet data from a panel of manufacturing firms, for the period 1998-2007. The analysis is performed by applying the TFP Törnqvist index and a special approach of finite mixture modelling for detecting time patterns of TFP firms: the Group-Based Trajectory modelling (GBT). The GBT method is applied separately for each of the four clusters of products derived from a classification of manufacturing sectors. The results reveal a widespread slowdown of the TFP across the four clusters, and the trajectories identified within each cluster indicate the prevalence of firms with poor TFP performance. The analysis of other structural and performance variables completes the description of the TFP trajectory groups