Productivity and wages of firms using COVID‐19‐related support policies

Abstract

AbstractObjectiveThis study analyzes the performance over the past several years of firms that have taken advantage of various COVID‐19‐related support policies.MethodsThis study uses survey data on Japanese firms linked with official firm statistics to analyze the productivity and wages over the past several years of firms.ResultsThe results indicate that the firms that used support policies had lower productivity and wages long before the pandemic. Firms that used multiple policy measures and those that repeatedly used support policies tended to show additionally lower performance.ConclusionsFirm support policies may have the side effect of preserving inherently inefficient firms and such a problem may increase in severity as support policies become prolonged.