Estimating production functions using energy to control for unobserved utilization

Zhanyu Dong, Hongqi Ma and Guangjun Shen

Economics Letters, 2021, vol. 209, issue C

Abstract: The recent production function estimators may overestimate or underestimate productivity growth due to ignoring the measurement errors caused by overcapacity. We extend the estimation procedure proposed by Ackerberg et al. (2015) by using energy to control for unobserved factor utilization.

Keywords: Production function; Productivity; Energy; Utilization-adjusted TFP (search for similar items in EconPapers)
JEL-codes: C23 D21 D24 L11 L61 (search for similar items in EconPapers)
Date: 2021
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Citations: View citations in EconPapers (2)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:ecolet:v:209:y:2021:i:c:s0165176521003955

DOI: 10.1016/j.econlet.2021.110118

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