IDEAS home Printed from https://ideas.repec.org/p/wpa/wuwpem/0508014.html
   My bibliography  Save this paper

Total Factor Productivity Growth in Finland 1960 − 1999

Author

Listed:
  • Rana Bose

    (University of Georgia)

Abstract

Our study encompasses two main objectives. One, using the 2001 OECD National Account database we compute Total Factor Productivity growth (TFPG) for Finland for the years from 1960 until 1999 using a chained Fisher index. We report that over the 4 decades Finland’s TFPG has grown on a 2.4% annual basis. Additionally our results echo other studies in estimating a slow-down in productivity growth for the 1974- 1991 period with TFPG registering a scant 0.7% average annual growth rate compared to a torrid 3.35% pace set in the previous period from 1960-1973. On a more positive note we document that TFPG growth accelerates quite dramatically for the decade of the 90s with an average growth rate of some 4.7% for the period from 1993 until 1999 suggesting that the Finnish economy might reprise its high growth performance last seen in the pre-1973 period.Second, we compute estimates of technical progress for Finland by specifying a Normalized Quadratic profit function analogous to the one used by Diewert & Fox (1999) in the producer context. We obtain as well estimates of producer (own and cross) supply price elasticities for the 1960-99 period. We estimate demand price elasticities in the consumer context by utilizing a Normalized Quadratic model once again for the same period and report finding rising trends in the annual producer and consumer price elasticities for Finland over the forty years period. It is alleged that these trends in elasticities in tandem with the high tax rates would lead to rising increasing deadweight losses over time which in combination with high inflation rampant in the decade of the 70s and 80s might possibly account for the productivity slump found in that period.

Suggested Citation

  • Rana Bose, 2005. "Total Factor Productivity Growth in Finland 1960 − 1999," Econometrics 0508014, EconWPA.
  • Handle: RePEc:wpa:wuwpem:0508014
    Note: Type of Document - pdf; pages: 47. Masters Essay
    as

    Download full text from publisher

    File URL: http://econwpa.repec.org/eps/em/papers/0508/0508014.pdf
    Download Restriction: no

    References listed on IDEAS

    as
    1. Isabelle Joumard & Wim Suyker, 2002. "Options for Reforming the Finnish Tax System," OECD Economics Department Working Papers 319, OECD Publishing.
    2. Diewart, W Erwin & Morrison, Catherine J, 1986. "Adjusting Output and Productivity Indexes for Changes in the Terms of Trade," Economic Journal, Royal Economic Society, vol. 96(383), pages 659-679, September.
    Full references (including those not matched with items on IDEAS)

    More about this item

    Keywords

    Total factor productivity; Normalized Quadratic models; index measurement;

    JEL classification:

    • C1 - Mathematical and Quantitative Methods - - Econometric and Statistical Methods and Methodology: General
    • C2 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables
    • C3 - Mathematical and Quantitative Methods - - Multiple or Simultaneous Equation Models; Multiple Variables
    • C4 - Mathematical and Quantitative Methods - - Econometric and Statistical Methods: Special Topics
    • C5 - Mathematical and Quantitative Methods - - Econometric Modeling
    • C8 - Mathematical and Quantitative Methods - - Data Collection and Data Estimation Methodology; Computer Programs

    NEP fields

    This paper has been announced in the following NEP Reports:

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:wpa:wuwpem:0508014. See general information about how to correct material in RePEc.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (EconWPA). General contact details of provider: http://econwpa.repec.org .

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service hosted by the Research Division of the Federal Reserve Bank of St. Louis . RePEc uses bibliographic data supplied by the respective publishers.