The gains traditionally resulting from innovation are not diffusing through companies and industries as they once did, leading to a long-term slowdown in productivity, Jason Douglas, Jon Sindreu and Georgi Kantchev write for the Wall Street Journal. Economists have found that the biggest companies, fueled by technology and innovative production methods, are growing at a much higher clip than their smaller counterparts. The discrepancy in productivity rates between large and small companies is also growing, meaning small companies are increasingly lagging behind.

So why isn’t productivity increasing at all companies, big or small? Part of the issue could be that bigger firms have more resources to invest in new technologies and other measures to increase productivity, whereas the smaller players struggle to scrape together the necessary costs and may also be dissuaded from taking risky decisions that could end in disaster. But AI is not solely responsible for the productivity gap. “Some economists say it could be that good managers have flocked to top firms — enticed by the larger pay offered by multinationals — and the laggards need to catch up. According to the World Management Survey, smaller firms are consistently worse run and are responsible for most differences in management across countries.”