4. Other empirical implications? High-RTS firms:
- Grow faster,
- Pay higher wages,
- Are owned by wealthier households.
These have major implications for inequality and optimal policy! With Hubmer, Chan, Salgado, and @guangbinhong.bsky.social
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1. Using data from 🇨🇦&🇺🇸, we find significant differences in higher returns to scale (RTS) across firms within industries.❗The largest firms don't have the highest TFP but operate technologies with much higher RTS❗The higher RTS is mainly explained by higher output elasticities of intermediate inputs.