TY - JOUR
T1 - Dual economies and international total factor productivity differences
T2 - Channelling the impact from institutions, trade, and geography
AU - Chanda, Areendam
AU - Dalgaard, Carl-Johan Lars
PY - 2008
Y1 - 2008
N2 - This paper provides a framework that decomposes aggregate total factor productivity (TFP) into a component reflecting relative efficiency across sectors, and another component that reflects the absolute level of efficiency. A development accounting analysis suggests that as much as 85% of the international variation in aggregate TFP can be attributed to variation in relative efficiency across sectors. Estimation results show that recent findings highlighting the importance of strong protection of property rights, financial development and geographical advantage for the level of TFP, can be explained by their impact on relative efficiency.
AB - This paper provides a framework that decomposes aggregate total factor productivity (TFP) into a component reflecting relative efficiency across sectors, and another component that reflects the absolute level of efficiency. A development accounting analysis suggests that as much as 85% of the international variation in aggregate TFP can be attributed to variation in relative efficiency across sectors. Estimation results show that recent findings highlighting the importance of strong protection of property rights, financial development and geographical advantage for the level of TFP, can be explained by their impact on relative efficiency.
U2 - 10.1111/j.1468-0335.2007.00673.x
DO - 10.1111/j.1468-0335.2007.00673.x
M3 - Journal article
SN - 0013-0427
VL - 75
SP - 629
EP - 661
JO - Economica
JF - Economica
IS - 300
ER -