Development Accounting and the Rise of TFP

April 1, 2010

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Reda Cherif, and Rabah Arezki. Development Accounting and the Rise of TFP, (USA: International Monetary Fund, 2010) accessed November 21, 2024

Disclaimer: This Working Paper should not be reported as representing the views of the IMF.The views expressed in this Working Paper are those of the author(s) and do not necessarily represent those of the IMF or IMF policy. Working Papers describe research in progress by the author(s) and are published to elicit comments and to further debate

Summary

The paper presents evidence that the contribution of differences in total factor productivity (TFP) to income differences across countries steadily increased between 1970 and 2000. We verify that our finding is neither imputable to measurement errors in input factors nor dependent on the assumption of factor neutral differences in technology. We conclude that theories explaining cross-country income differences based on institutions or on forces that are constant over time, such as geography or legal origin, should be reconsidered in the light of their consistency with the rise of the explanatory power of TFP.

Subject: Capital productivity, Growth accounting, Human capital, Personal income, Total factor productivity

Keywords: Physical capital, WP

Publication Details

Pages:

32
Volume:

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DOI:

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Issue:

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Series:

Working Paper No. 2010/101
Stock No:

WPIEA2010101
ISBN:

9781451982787
ISSN:

1018-5941

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