Product Diversification and Labor Productivity Dispersion in German Manufacturing Industries Volume 4 Jena Economic Research Papers 2010-04-28 2010 2007 2010-028 Product Diversification Productivity Industrial Dynamics Empirical research has shown tremendous productivity differences, even within narrowly defined industries. A great host of studies is explainsing this productivity disparity by factors such as idiosyncratic technology shocks, input price differences, management skills, or international trade. Although these explanations are undoubtedly important, the current paper suggests that product diversification strategies of firms can also play an important role. Using a matched producer-product panel dataset of German manufacturing industries over the period 2003-2006, we find that the average degree of product diversification across industry establishments is positively related to within-industry labor productivity dispersion. jportal_jpjournal_00000016 2010-05-03T12:25:59.004Z 2010-12-17T11:54:19.650Z