Abstract: As the age of the company grows, how would the labor productivity change? Based on the 2015 China Employer-Employee Survey data, this paper investigates the age effect of labor productivity in manufacturing companies. According to the results of Fixed Effect OLS regression, a reverse U-shape relation between the age and labor productivity of firms is found in the full sample and sub sample of enterprises with domestic investment only, while no significant age effect is found in foreign owned enterprises. After calculation，we find that the labor productivity of firms reaches its highest value at the age of ten. Therefore, this paper reaches the conclusion that firms should be encouraged to offer specialized training on new technology in order to improve the capital quality. Firms should transfer the development mode, break away from dependence on traditional path, and place more emphasis on quality efficiency so as to hedge the negative impact of age increase on labor productivity.
Keywords: firm age; enterprise labor productivity; critical point