Cross-Country Productivity Comparisons: The "Revealed Superiority" Approach
AbstractThis paper proposes a novel non-parametric methodology for comparing total factor productivity (TFP) across countries and over time. It develops the principle of revealed superiority along the lines of Samuelson's principle of revealed preferences. Specifically, we compare the aggregate actual profits in each country to the hypothetical profits it would have earned if, facing its own prices, it had employed another country's inputs and produced its output. We show that our procedure reveals the "true" TFP ranking under relatively mild assumptions. We apply our method by ranking a panel of the 25 richest economies relative to one another and over time and find that the United States enjoys the highest TFP whereas Singapore has the lowest. Copyright 2003 by Kluwer Academic Publishers
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Bibliographic InfoArticle provided by Springer in its journal Journal of Economic Growth.
Volume (Year): 8 (2003)
Issue (Month): 3 (September)
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Web page: http://www.springerlink.com/link.asp?id=102931
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- Engelbrecht, Hans-Jurgen & Xayavong, Vilaphonh, 2004. "Information And Communication Technology And New Zealand'S Productivity Malaise: An Industry-Level Study," Discussion Papers 23698, Massey University, Department of Applied and International Economics.
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