A Proposal to Improve Country-Level Data on Total Factor Productivity Growth

March 22, 2024

Preview Citation

Format: Chicago

Andrew M. Warner A Proposal to Improve Country-Level Data on Total Factor Productivity Growth, (USA: International Monetary Fund, 2024) accessed December 21, 2024

Disclaimer: IMF Working Papers describe research in progress by the author(s) and are published to elicit comments and to encourage debate. The views expressed in IMF Working Papers are those of the author(s) and do not necessarily represent the views of the IMF, its Executive Board, or IMF management.

Summary

The assumption behind popular data on national capital stocks, and therefore total factor productivity, is that countries were in a steady state in the first year that investment data became available. This paper argues that this assumption is highly implausible and is necessarily responsible for implausible data on the ratio of capital to output and productivity growth. It is not credible that countries with similar incomes had huge differences in their capital stocks. This paper claims, with evidence, that implausible features of the data can be greatly reduced by using data on electricity usage or national stocks of road vehicles.

Subject: Capital adequacy requirements, Capital productivity, Commodities, Electricity, Financial institutions, Financial regulation and supervision, Production, Stocks, Total factor productivity

Keywords: Africa, Capital adequacy requirements, Capital output ratio, Capital productivity, Capita-output ratio, Economic Growth, Electricity, Global, Investment data, Productivity, Stocks, TFP growth estimate, Total Factor Productivity, Total factor productivity growth

Publication Details

Pages:

39
Volume:

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DOI:

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Issue:

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Series:

Working Paper No. 2024/067
Stock No:

WPIEA2024067
ISBN:

9798400269011
ISSN:

1018-5941

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