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Potential output is an important concept in economics. Policymakers often use a one-sector neoclassical model to think about long-run growth, and often assume that potential output is a smooth series in the short run--approximated by a medium- or long-run estimate. But in both the short and long...
Persistent link: https://www.econbiz.de/10005498385
Using data on gross output for two-digit manufacturing industries, we find that an increase in the output of one manufacturing sector has little or no significant effect on the productivity of other sectors. Using value-added data, however, we confirm the results of previous studies which find...
Persistent link: https://www.econbiz.de/10005498771
Aggregate productivity and aggregate technology are meaningful but distinct concepts. We show that a slightly-modified Solow productivity residual measures changes in economic welfare, even when productivity and technology differ because of distortions such as imperfect competition. We then...
Persistent link: https://www.econbiz.de/10005498862
This paper addresses the proper measurement of financial service output that is not priced explicitly. It shows how to impute nominal service output from financial intermediaries’ interest income and how to construct price indices for those financial services. We present an optimizing model...
Persistent link: https://www.econbiz.de/10005379778
Persistent link: https://www.econbiz.de/10005109275
Persistent link: https://www.econbiz.de/10005082294
Potential output is an important concept in economics. Policymakers often use a one-sector neoclassical model to think about long-run growth, and they often assume that potential output is a smooth series in the short run -- approximated by a medium- or long-run estimate. But in both the short...
Persistent link: https://www.econbiz.de/10005065571
We argue that unmeasured investments in intangible organizational capital—associated with the role of information and communications technology (ICT) as a ‘general purpose technology’—can explain the divergent U. S. and U. K. TFP performance after 1995. GPT stories suggest that measured...
Persistent link: https://www.econbiz.de/10005664353
Yes. We construct a measure of aggregate technology change, controlling for aggregation effects, varying utilization of capital and labor, nonconstant returns, and imperfect competition. On impact, when technology improves, input use and nonresidential investment fall sharply. Output changes...
Persistent link: https://www.econbiz.de/10005821801
We estimate that returns to scale are close to constant in two-digit gross output data. Value-added data appear instead to give significant increasing returns. We show why, with imperfect competition, value-added estimates are in general meaningless. We use data on intermediate inputs to correct...
Persistent link: https://www.econbiz.de/10005712835