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Development Accounting with Intermediate Goods AgEcon
Grobovsek, Jan.
Do intermediate goods help explain relative and aggregate productivity differences across countries? Three observations suggest they do: (i) intermediates are relatively expensive in poor countries; (ii) goods industries demand intermediates more intensively than service industries; (iii) goods industries are more prominent intermediate suppliers in poor countries. I build a standard multisector growth model accommodating these features to show that inefficient intermediate production strongly depresses aggregate productivity and increases the price ratio of final goods to services. Applying the model to data for middle and high income countries, I find that poorer countries are only modestly less efficient at producing goods than services, but...
Tipo: Working Paper Palavras-chave: Development Accounting; Productivity; Intermediate Goods; Production Economics; O10; O41; O47.
Ano: 2011 URL: http://purl.umn.edu/119112
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