Choose an application

• Reference Manager
• EndNote
• RefWorks (Direct export to RefWorks)

"We prove that the change in welfare of a representative consumer is summarized by the current and expected future values of the standard Solow productivity residual. The equivalence holds if the representative household maximizes utility while taking prices parametrically. This result justifies TFP as the right summary measure of welfare (even in situations where it does not properly measure technology) and makes it possible to calculate the contributions of disaggregated units (industries or firms) to aggregate welfare using readily available TFP data. Based on this finding, we compute firm and industry contributions to welfare for a set of European OECD countries (Belgium, France, Great Britain, Italy, Spain), using industry-level (EU-KLEMS) and firm-level (Amadeus) data. After adding further assumptions about technology and market structure (firms minimize costs and face common factor prices), we show that welfare change can be decomposed into three components that reflect respectively technical change, aggregate distortions and allocative efficiency. Using the appropriate firm-level data, we assess the importance of each of these components as sources of welfare improvement in the same set of European countries"--National Bureau of Economic Research web site.

Production • Cost • Capital • Capital, Total Factor, and Multifactor Productivity • Capacity --- Micro-Based Behavioral Economics --- General --- Empirical Studies of Economic Growth • Aggregate Productivity • Cross-Country Output Convergence

Choose an application

• Reference Manager
• EndNote
• RefWorks (Direct export to RefWorks)

While the world is focused on addressing the near-term ramifications of the COVID-19 shock, we turn attention to another important aspect of the pandemic: its fallout on medium-term potential output through scarring. Taking Australia and New Zealand as examples, we show that the pandemic will likely have a large and persistent impact on potential output, broadly in line with the experience of advanced economies from past recessions. The impact is driven by employment, capital stock, and productivity losses in the wake of an unprecedented sectoral reallocation, hightened uncertainty, and reduced migration. Maintaining fiscal and monetary policy support until the recovery is firmly entrenched and putting in place a strong structural policy agenda to counter the pandemic’s adverse effects on medium-term potential output will be important to support standards of living and strengthen economic resilience in case of renewed shocks.

Business and Economics --- Macroeconomics --- Economics: General --- International Economics --- Macroeconomics: Consumption, Saving, Production, Employment, and Investment: General (includes Measurement and Data) --- Economic Growth and Aggregate Productivity: General --- Measurement of Economic Growth --- Aggregate Productivity --- Cross-Country Output Convergence --- Economywide Country Studies: Oceania --- Economic & financial crises & disasters --- Economics of specific sectors --- Financial crises --- Economic sectors --- Currency crises --- Informal sector --- Economics --- Pandemics --- COVID-19 (Disease) --- Business and Economics. --- Macroeconomics. --- Economics: General. --- International Economics. --- Economic Growth and Aggregate Productivity: General. --- Measurement of Economic Growth. --- Aggregate Productivity. --- Cross-Country Output Convergence. --- Economywide Country Studies: Oceania. --- Economic & financial crises & disasters. --- Economics of specific sectors. --- Financial crises. --- Economic sectors. --- Currency crises. --- Informal sector. --- Economics. --- Economic aspects.

Choose an application

• Reference Manager
• EndNote
• RefWorks (Direct export to RefWorks)

Analysis of 1960-2002 data shows that average real GDP growth in sub-Saharan Africa was low and decelerated continuously before starting to recover in the second part of the 1990s. Growth was driven primarily by factor accumulation with little role for total factor productivity (TFP) growth. The recent pickup in economic growth was accompanied by an increase in TFP growth, namely in the group of countries whose IMF-supported programs were judged to be on track. Average annual growth in the region, at 3½ percent during 1997-2002, is less than half of the estimated growth needed to halve the fraction of population living below $1 per day between 1990 and 2015, one of the Millennium Development Goals.

Productivity accounting --- Labor productivity --- Accounting --- Industrial productivity --- Macroeconomics --- Production and Operations Management --- Economywide Country Studies: Africa --- Measurement of Economic Growth --- Aggregate Productivity --- Cross-Country Output Convergence --- Production --- Cost --- Capital and Total Factor Productivity --- Capacity --- Labor Economics: General --- Economic growth --- Labour --- income economics --- Total factor productivity --- Growth accounting --- Labor --- Economic development --- Labor economics --- Equatorial Guinea, Republic of

Choose an application

• Reference Manager
• EndNote
• RefWorks (Direct export to RefWorks)

This paper estimates potential output and the sources of growth in Chile during 1970-96. Actual output is cointegrated with the quality-adjusted measures of capital and labor, and constant returns to scale cannot be rejected. The estimates of potential output show a positive output gap in the years when the Chilean economy was deemed to be overheated. In 1986-90, the quality-adjusted labor variable explains close to 60 percent of the growth rate of GDP, while during 1991-95 capital formation plays a dominant role. The contribution of TFP growth in Chile is relatively small, but, based on a comparison with European and East Asian experiences, it is expected to increase in the medium term.

Macroeconomics --- Production and Operations Management --- Economic Growth of Open Economies --- Measurement of Economic Growth --- Aggregate Productivity --- Cross-Country Output Convergence --- Economywide Country Studies: Latin America --- Caribbean --- Macroeconomics: Production --- Production --- Cost --- Capital and Total Factor Productivity --- Capacity --- Labor Economics: General --- Labour --- income economics --- Total factor productivity --- Labor --- Potential output --- Production growth --- Output gap --- Economic theory --- Industrial productivity --- Labor economics --- Chile

Choose an application

• Reference Manager
• EndNote
• RefWorks (Direct export to RefWorks)

The Fund has recognized in recent years that one cannot separate issues of economic growth and stability on one hand and equality on the other. Indeed, there is a strong case for considering inequality and an inability to sustain economic growth as two sides of the same coin. Central to the Fund’s mandate is providing advice that will enable members’ economies to grow on a sustained basis. But the Fund has rightly been cautious about recommending the use of redistributive policies given that such policies may themselves undercut economic efficiency and the prospects for sustained growth (the so-called “leaky bucket” hypothesis written about by the famous Yale economist Arthur Okun in the 1970s). This SDN follows up the previous SDN on inequality and growth by focusing on the role of redistribution. It finds that, from the perspective of the best available macroeconomic data, there is not a lot of evidence that redistribution has in fact undercut economic growth (except in extreme cases). One should be careful not to assume therefore—as Okun and others have—that there is a big tradeoff between redistribution and growth. The best available macroeconomic data do not support such a conclusion.

Economic Development --- Income Distribution --- Business & Economics --- Macroeconomics --- Macroeconomic Analyses of Economic Development --- Economic Development: Human Resources --- Human Development --- Migration --- Measurement of Economic Growth --- Aggregate Productivity --- Cross-Country Output Convergence --- Fiscal Policy --- Taxation and Subsidies: Externalities --- Redistributive Effects --- Environmental Taxes and Subsidies --- Aggregate Factor Income Distribution --- Personal Income, Wealth, and Their Distributions --- Income inequality --- Personal income --- Fiscal redistribution --- Income distribution --- National accounts --- Income --- United States