THE ROLE OF TECHNOLOGY USE IN THE SURVIVAL AND GROWTH OF MANUFACTURING PLANTS

This paper documents the relationship between capital intensity, the u se of advanced manufacturing technology, growth rates, and exit probab ilities for a sample of U.S. manufacturing plants. It utilizes data fr om a unique establishment survey of technology usage that allows us to control for both the quantity and heterogeneity of capital in the pla nt. The main findings are that capital-intensive plants and plants emp loying advanced technology have higher growth rates and are less likel y to fail. The effects are present after controlling for plant product ivity and age; however, the technology results are sensitive to the in clusion of size variables.