Measuring the Impact of Manufacturing Extension

In this paper, I measure the impact of manufacturing extension on productivity and sales growth at manufacturing plants. To do this, I match manufacturing extension client data to the Census Bureau’s Longitudinal Research Database (LRD). The LRD contains data for all manufacturing establishments in the U.S. and provides a number of measures of plant performance and characteristics that are measured consistently across plants and time. This facilitates valid comparisons between both client and non-client plants and among clients served by different manufacturing extension centers. The goal of the paper is to see if measures of plant performance (e.g., productivity and sales growth) are systematically related to participation in manufacturing extension, while controlling for other factors that are known or thought to influence performance. Selection bias is often a problem in evaluation studies, so I specify an econometric model that controls for selection. I estimate the model with data from 8 manufacturing extension centers in 2 states. The control group includes all plants from each state in the LRD. Results indicate that participation in manufacturing extension is systematically related to productivity growth but not to sales growth.