冰岛生产率放缓的诊断：企业层面的证据

Diagnosing Iceland’sProductivity Slowdown:Firm-Level Evidence Harri Kemp SIP/2026/083 IMF Selected Issues Papers are prepared by IMF staff asbackground documentation for periodic consultations withmember countries.It is based on the information available atthe time it was completed on July10, 2026. This paper is alsopublished separately as IMF Country Report No26/209. 2026AUG IMF Selected Issues PaperEuropean Department Diagnosing Iceland’s Productivity Slowdown: Firm-Level EvidencePrepared by Harri Kemp Authorized for distribution by Metodij Hadzi-VaskovAugust2026 IMF Selected Issues Papersare prepared by IMF staff as background documentation for periodicconsultations with member countries.It is based on the information available at the time it wascompleted on July10, 2026. This paper is also published separately as IMF Country Report No26/209. ABSTRACT:Iceland maintains one of the highest levels of GDP per capita among advanced economiesdespite a marked slowdown in productivity growth over the past decade. Using firm-level data from the IMFRES-ORBIS database, this paper investigates the sources of the productivity slowdown and finds that theproblem is primarily allocative. While continuing firms continue to record productivity gains and laggard firmsconverge rapidly toward the domestic productivity frontier, these gains do not translate into stronger aggregateproductivity growth. The analysis points to four interconnected factors: weak allocation of labor and capitaltoward the most productive firms, convergence toward a domestic frontier that remains below the Europeanfrontier, declining market selection with rising prevalence of low-productivity “zombie” firms, and a pervasiveproductivity penalty associated with firm expansion. The findings suggest that strengthening competition,improving business dynamism and resource reallocation, facilitating firm entry and exit, easing scalingconstraints, and investing in innovation, skills, and infrastructure could help raise productivity growth andsupport stronger long-term economic performance in Iceland. RECOMMENDED CITATION:Kemp, Harri. 2026. “Diagnosing Iceland’s Productivity Slowdown: Firm-LevelEvidence.” Selected Issues Paper (SIP/2026/083), 2026, Article IV Consultation, International Monetary Fund,Washington, DC. Diagnosing Iceland’s ProductivitySlowdown: Firm-Level Evidence Iceland Prepared byHarri Kemp ICELAND SELECTED ISSUES DIAGNOSING ICELAND’S PRODUCTIVITY SLOWDOWN: FIRM-LEVEL EVIDENCE_2 A. Introduction_________________________________________________________________________2B. Aggregate Backdrop_________________________________________________________________2C. Data and Measurement______________________________________________________________5D. Drivers of the Aggregate Productivity Slowdown: Firm-Level Evidence______________6E. Possible Implications_______________________________________________________________13F. Conclusion_________________________________________________________________________15 FIGURES 1. Growth Accounting and Labor Productivity__________________________________________32. GDP per Capita and Labor Productivity______________________________________________33. GEAD Productivity Decomposition___________________________________________________44. Laggard-Frontier Productivity Catch-up______________________________________________75. Within-Sector Capital and Labor Misallocation_______________________________________86. Within-Sector Allocative Efficiency___________________________________________________97. Cross-Sector Allocative Efficiency__________________________________________________108. Zombie Firms and Firm Transition__________________________________________________109. Entrant Productivity Developments and Scaling Penalty___________________________12 ANNEX Technical Annex______________________________________________________________________18 References____________________________________________________________________________16 DIAGNOSING ICELAND’S PRODUCTIVITYSLOWDOWN: FIRM-LEVEL EVIDENCE1 Icelandmaintainsa high level of GDP per capitadespiterelativelyweak level of labor productivity, andasharpslowdown inproductivity growth over the last decade.Economicgrowthin recent yearshasrelied increasingly on high labor utilization rather than productivitygrowth. Using firm-level evidence,this paperexamines the drivers of the aggregate productivity slowdown. We show thatwhilethetypical firm continues to post productivity gains, thosefirm-levelgains do not translate into strongeraggregateproductivity.This outcome is due to four main reasons(i)capital and labor are notallocatedtoward the most productive firms; (ii) productivityconvergence occurs toward a frontier that itselfremains below the Europeanone; (iii) low-productivity firms remain in the market for too long;and(iv)productive firms face a penalty when theytrytoscale.Possible options to address these challengescenteron(i) improvingallocative efficien