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While profitability improved for a sample of 260 downscaling firms in 46 industries, productivity declined dramatically. We propose and critically examine five competing hypotheses to explain these findings 1 learning curve effects associated with new technologies 2 experience curve effects associated with the introduction of new products or entering new markets 3 systemic problems within the firm 4 unexpected loss of more productive employees, and 5 reduced commitment among remaining employees.
Competitiveness Review – Emerald Publishing
Published: Feb 1, 2000
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