A number of conceptually robust and empirically practical approaches are available to assess relative economic performance among producers who operate on either side of an international border. In this paper we discuss the impact that data compilation, methodological choice, and variable definitions may have on the quantitative and qualitative assessment of cross-border performance comparisons. As an illustrative example we use manuscript census data from 1870/71 to compare total factor productivity (TFP) among a sample of manufacturing establishments located along the Canada-US border. We briefly discuss issues associated with the preparation of manuscript census data for the measurement of cross-border TFP differentials and the establishment of industry selection criteria. We also review TFP measurement techniques, such as growth accounting calculations, cost and production function index number approaches, and econometric estimation. However, the central focus of the paper is an investigation of the impact that variable definitions have on our assessment of TFP performance. In particular, we probe the relationship between the size of cross-border TFP differentials and the reliance on a variety of common definitions for labour, capital, output, input weights, and prices.
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Paper provided by Queen's University, Department of Economics in its series Working Papers with number
1030.
Find related papers by JEL classification: N01 - Economic History - - General - - - Development of the Discipline: Historiographical; Sources and Methods N61 - Economic History - - Manufacturing and Construction - - - U.S.; Canada: Pre-1913 O14 - Economic Development, Technological Change, and Growth - - Economic Development - - - Industrialization; Manufacturing and Service Industries; Choice of Technology O47 - Economic Development, Technological Change, and Growth - - Economic Growth and Aggregate Productivity - - - Measurement of Economic Growth; Aggregate Productivity; Cross-Country Output Convergence
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