Aggregation of economic growth rates and of its sources
AbstractIn this paper we consider the question of measuring aggregate economic growth and its sources. We derive a theoretically justified solution for aggregating (across firms, industries, countries, etc.) growth rates and their sources within the framework of Solow's (1957) growth accounting method. The resulting aggregation scheme turns out to be quite intuitive and, in fact, the one that is sometimes used in practice, but with theoretical justification missing and so the main value of our work is that our formal derivations show under what conditions this scheme has economic theory justification. We also provide a small empirical illustration of our method on the real data set and show how different the conclusions can be depending on the aggregation scheme used.
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Bibliographic InfoArticle provided by Elsevier in its journal European Journal of Operational Research.
Volume (Year): 212 (2011)
Issue (Month): 1 (July)
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Web page: http://www.elsevier.com/locate/eor
Growth accounting Productivity Aggregation;
Other versions of this item:
- Valentin Zelenyuk, 2010. "Aggregation of Economic Growth Rates and of its Sources," CEPA Working Papers Series WP032010, School of Economics, University of Queensland, Australia.
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