This paper examines productivity dynamics in manufacturing plants, highlighting the importance of plant-level heterogeneity and the role of entry and exit in industry productivity growth. The study uses the Longitudinal Research Database (LRD) prepared by the Bureau of the Census to analyze plant-level productivity and its evolution over time. The findings reveal significant differences in productivity across plants, with high-productivity plants contributing more to overall industry growth than low-productivity ones. The study also finds that entry and exit play a minor role in productivity growth over five-year periods, while changes in output shares among plants are a major contributor. The paper discusses the importance of plant fixed effects, which reflect long-term differences in plant characteristics such as management quality and workforce quality. It also explores the impact of returns to scale and utilization effects on productivity, noting that plants may experience short-run declines in productivity due to factors like labor hoarding. The study finds that persistent differences in managerial ability and workforce quality can explain variations in plant productivity. The paper also addresses the implications of these findings for policy, emphasizing the need to allow high-productivity plants to grow and the importance of understanding the dynamics of plant entry and exit. It highlights the role of antitrust policy in ensuring that the best plants can grow and thrive. The study concludes that the distribution of productivity among plants is influenced by various factors, including technological change, managerial ability, and workforce quality. The results show that the movement of plants within the productivity distribution is significant, with some plants rising or falling in productivity over time. The study provides insights into the factors that drive productivity growth in manufacturing and the importance of considering plant-level heterogeneity in productivity analysis.This paper examines productivity dynamics in manufacturing plants, highlighting the importance of plant-level heterogeneity and the role of entry and exit in industry productivity growth. The study uses the Longitudinal Research Database (LRD) prepared by the Bureau of the Census to analyze plant-level productivity and its evolution over time. The findings reveal significant differences in productivity across plants, with high-productivity plants contributing more to overall industry growth than low-productivity ones. The study also finds that entry and exit play a minor role in productivity growth over five-year periods, while changes in output shares among plants are a major contributor. The paper discusses the importance of plant fixed effects, which reflect long-term differences in plant characteristics such as management quality and workforce quality. It also explores the impact of returns to scale and utilization effects on productivity, noting that plants may experience short-run declines in productivity due to factors like labor hoarding. The study finds that persistent differences in managerial ability and workforce quality can explain variations in plant productivity. The paper also addresses the implications of these findings for policy, emphasizing the need to allow high-productivity plants to grow and the importance of understanding the dynamics of plant entry and exit. It highlights the role of antitrust policy in ensuring that the best plants can grow and thrive. The study concludes that the distribution of productivity among plants is influenced by various factors, including technological change, managerial ability, and workforce quality. The results show that the movement of plants within the productivity distribution is significant, with some plants rising or falling in productivity over time. The study provides insights into the factors that drive productivity growth in manufacturing and the importance of considering plant-level heterogeneity in productivity analysis.