Aggregating and Decomposing Productivity
AbstractWe illustrate how the aggregate level of total factor productivity, as obtained from aggregate input and output statistics, can be replicated by summing appropriately weighted firm-level measures. This exact aggregation has a number of advantages over existing practices. First, the contribution of different sub-samples to a well-defined aggregate is easily identified. Second, the importance of patterns at the micro level, such as larger size or higher capital intensity for more productive firms, for the aggregate can be calculated. Third, it allows the exact decomposition of aggregate output growth into the contribution of several factors, among which firm-level total factor productivity growth, an inherently relative concept. A sample of all Chinese manufacturing firms with annual sales above five million RMB is used to illustrate the usefulness of the different decompositions.
Download InfoIf you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
Bibliographic InfoArticle provided by Katholieke Universiteit Leuven, Faculteit Economie en Bedrijfswetenschappen in its journal Review of Business and Economics.
Volume (Year): LIII (2008)
Issue (Month): 2 ()
labor productivity; total factor productivity; exact aggregation; China; manufacturing;
Find related papers by JEL classification:
- O4 - Economic Development, Technological Change, and Growth - - Economic Growth and Aggregate Productivity
- D24 - Microeconomics - - Production and Organizations - - - Production; Cost; Capital; Capital, Total Factor, and Multifactor Productivity; Capacity
- L60 - Industrial Organization - - Industry Studies: Manufacturing - - - General
- J24 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Human Capital; Skills; Occupational Choice; Labor Productivity
You can help add them by filling out this form.
CitEc Project, subscribe to its RSS feed for this item.
- Massimo Del Gatto & Adriana Di Liberto & Carmelo Petraglia, 2011.
Journal of Economic Surveys,
Wiley Blackwell, vol. 25(5), pages 952-1008, December.
- Massimo Armenise & Giorgia Giovannetti & Gianluca Santoni, 2011. "FDI in Business Services has general TFP effects : evidence from Italy," Working Papers - Economics wp2011_12.rdf, Universita' degli Studi di Firenze, Dipartimento di Scienze per l'Economia e l'Impresa.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Hilde Roos) The email address of this maintainer does not seem to be valid anymore. Please ask Hilde Roos to update the entry or send us the correct address.
If references are entirely missing, you can add them using this form.