A Univariate Model of Aggregate Labour Productivity

Robert Dixon and Guay Lim

Melbourne Institute Working Paper Series from Melbourne Institute of Applied Economic and Social Research, The University of Melbourne

Abstract: In this paper, we set out a model of labour productivity which distinguishes between shocks which change productivity permanently and shocks which have transient affects on productivity. We show that this model is a type of unobserved components model –a random walk with drift plus noise model. The advantage of this approach is that it provides a coherent framework to identify the deterministic trend growth component and also the productivity-enhancing (or technology-related) stochastic components. The model is applied to aggregate labour productivity in Australia and the time series of technology shocks extracted is used to shed some light on the contributions of policy reforms to productivity.

Pages: 15 pages
Date: 2008-05
New Economics Papers: this item is included in nep-eff and nep-mac
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Citations: View citations in EconPapers (1)

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Related works:
Journal Article: A univariate model of aggregate labour productivity (2013)
Journal Article: A univariate model of aggregate labour productivity (2012)
Journal Article: A univariate model of aggregate labour productivity (2012)
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Persistent link: https://EconPapers.repec.org/RePEc:iae:iaewps:wp2008n09

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