Cross-country comparisons of industry total factor productivity: theory and evidence
International trade economists typically assume that TFP for each industry is the same in every country. This paper casts doubt on this hypothesis, finding large and persistent TFP differences across countries. The paper considers measurement issues in depth, and a methodology for international TFP comparisons is described. This methodology is applied to a dataset on prices, inputs, and outputs for a group of industrialized countries in the 1980s. The paper finds that the United States was the TFP leader in machinery and equipment during the 1980s, with Japan slightly behind. These results are compared to the previous literature on disaggregated TFP comparisons.
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- Hooper, Peter & Larin, Kathryn A, 1989. "International Comparisons of Labor Costs in Manufacturing," Review of Income and Wealth, International Association for Research in Income and Wealth, vol. 35(4), pages 335-55, December.
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36, Federal Reserve Bank of New York.
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15, Federal Reserve Bank of New York.
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- James Harrigan, 1996. "Technology, Factor Supplies and International Specialization: Estimating the Neoclassical Model," NBER Working Papers 5722, National Bureau of Economic Research, Inc.
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- Trefler, Daniel, 1993. "International Factor Price Differences: Leontief Was Right!," Journal of Political Economy, University of Chicago Press, vol. 101(6), pages 961-87, December.
- repec:cup:cbooks:9780521453455 is not listed on IDEAS
- Caves, Douglas W & Christensen, Laurits R & Diewert, W Erwin, 1982. "Multilateral Comparisons of Output, Input, and Productivity Using Superlative Index Numbers," Economic Journal, Royal Economic Society, vol. 92(365), pages 73-86, March.
- Keith E. Maskus, 1991. "Comparing International Trade Data and Product and National Characteristics Data for the Analysis of Trade Models," NBER Chapters, in: International Economic Transactions: Issues in Measurement and Empirical Research, pages 17-60 National Bureau of Economic Research, Inc.
- Trefler, Daniel, 1995. "The Case of the Missing Trade and Other Mysteries," American Economic Review, American Economic Association, vol. 85(5), pages 1029-46, December.
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