Aggregation of economic growth rates and of its sources

Valentin Zelenyuk

European Journal of Operational Research, 2011, vol. 212, issue 1, 190-198

Abstract: In this paper we consider the question of measuring aggregate economic growth and its sources. We derive a theoretically justified solution for aggregating (across firms, industries, countries, etc.) growth rates and their sources within the framework of Solow's (1957) growth accounting method. The resulting aggregation scheme turns out to be quite intuitive and, in fact, the one that is sometimes used in practice, but with theoretical justification missing and so the main value of our work is that our formal derivations show under what conditions this scheme has economic theory justification. We also provide a small empirical illustration of our method on the real data set and show how different the conclusions can be depending on the aggregation scheme used.

Keywords: Growth; accounting; Productivity; Aggregation (search for similar items in EconPapers)
Date: 2011
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Citations: View citations in EconPapers (6)

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Related works:
Working Paper: Aggregation of Economic Growth Rates and of its Sources (2010)
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Persistent link: https://EconPapers.repec.org/RePEc:eee:ejores:v:212:y:2011:i:1:p:190-198

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