Talent Utilization, a Source of Bias in Measuring TFP
AbstractThis paper analyzes a model of economic growth that explains differences in economic structure across countries. It highlights the interplay between productivity, talents utilization and entrepreneurship incentives. The paper has two main results. First, it argues that when measuring human capital we ignore one dimension, which is \talents utilization". It is suggested then that, in development accounting, human capital is inaccurately measured. Second, it shows that the magnitude of talents utilization increases with the level of development. Thus, the paper suggests that talents utilization amplifies differences in productivity and contributes to the explanation of large observed international differences in per capita income.
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Bibliographic InfoPaper provided by European University Institute in its series Economics Working Papers with number ECO2007/27.
Date of creation: 2007
Date of revision:
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More information through EDIRC
Total factor productivity; talent utilization; human capital; factor accumulation;
Find related papers by JEL classification:
- L16 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - Industrial Organization and Macroeconomics; Macroeconomic Industrial Structure
- O11 - Economic Development, Technological Change, and Growth - - Economic Development - - - Macroeconomic Analyses of Economic Development
- O14 - Economic Development, Technological Change, and Growth - - Economic Development - - - Industrialization; Manufacturing and Service Industries; Choice of Technology
- O33 - Economic Development, Technological Change, and Growth - - Technological Change; Research and Development; Intellectual Property Rights - - - Technological Change: Choices and Consequences; Diffusion Processes
- O47 - Economic Development, Technological Change, and Growth - - Economic Growth and Aggregate Productivity - - - Measurement of Economic Growth; Aggregate Productivity; Cross-Country Output Convergence
This paper has been announced in the following NEP Reports:
- NEP-ALL-2007-11-03 (All new papers)
- NEP-EFF-2007-11-03 (Efficiency & Productivity)
- NEP-ENT-2007-11-03 (Entrepreneurship)
- NEP-HRM-2007-11-03 (Human Capital & Human Resource Management)
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