Working Paper 03-07 - Capital services and total factor productivity measurements: impact of various methodologies for Belgium

Bernadette Biatour, Geert Bryon and Chantal Kegels

Working Papers from Federal Planning Bureau, Belgium

Abstract: This Working Paper presents the different methodologies currently used to construct a volume index of capital services and analyzes the effects of methodological changes on capital services and total factor productivity estimates for Belgium over the period 1970-2004. The measurement of capital services is realized in two steps. First, productive capital stocks have to be estimated for each type of asset. Two methodologies are generally used: the geometric and the hyperbolic profile. Secondly, these stocks are aggregated, using the user costs of capital (exante or ex-post approach) as weights to derive an overall index. For the economy as a whole and the entire period, under an ex-post approach, the volume indices of capital services estimated with a hyperbolic age-efficiency profile grow at a higher rate than the indices estimated with a geometric profile. This general conclusion is, however, not observed in every sector. Under an ex-ante approach, the different volume indices are quite similar for the whole economy, even if the indices grow generally at a slightly higher rate in the case of a geometric pattern. A higher growth rate of the volume indices generates a higher capital contribution and, consequently, a lower TFP contribution. Over long periods of time, the different TFP estimates are relatively similar. Over shorter periods, the different methodologies generate more significant variations in the TFP contribution.

Keywords: TFP (search for similar items in EconPapers)
JEL-codes: C81 D24 O40 (search for similar items in EconPapers)
Date: 2007-03-01
References: Add references at CitEc
Citations: View citations in EconPapers (4)

Downloads: (external link)
https://www.plan.be/uploaded/documents/200703160825330.wp0703.pdf english version (application/pdf)
Our link check indicates that this URL is bad, the error code is: 503 Service Unavailable

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:fpb:wpaper:200703

Access Statistics for this paper

More papers in Working Papers from Federal Planning Bureau, Belgium Contact information at EDIRC.
Bibliographic data for series maintained by Dominique van der Wal ().