The main aim of this paper is to propose a method for obtaining estimates of Total Factor Productivity (TFP) trends (i) free from the restrictive assumptions needed by traditional growth accounting and (ii) requiring only data on inputs and output flows. The approach proposed relies on recent developments in the analysis of non-stationary dependent panels. The ap- plication to the Italian economy for the period 1981-2004, consistently with those obtained through traditional growth accounting methods, supports the view that the decline in Italian labour productivity has been mostly due to a widespread fall in TFP growth. A simple regression points as main causes of this fall the completion of a factor reallocation process among industries and capital types.
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Paper provided by University Library of Munich, Germany in its series MPRA Paper with number
3112.
Find related papers by JEL classification: C23 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Models with Panel Data D24 - Microeconomics - - Production and Organizations - - - Production; Capital and Total Factor Productivity; Capacity
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