Intangibles, markups, and the measurement of productivity growth

Nicolas Crouzet and Janice Eberly

Journal of Monetary Economics, 2021, vol. 124, issue S, S92-S109

Abstract: In recent years, measured TFP growth in the US has declined. We argue that two forces contributed to this decline: the mismeasurement of intangible capital, and rising markups. Markups affect input shares, while intangibles omitted from measures of investment affect measured capital growth, each potentially generating downward bias in measured TFP growth. Most importantly, when both forces are simultaneously present, their effects reinforce each other and amplify the downward bias in measured TFP growth. Using input-output data, we estimate that this mechanism could account for one-third to two-thirds of the decline in measured TFP growth.

Keywords: Productivity growth; Intangible capital; Markups; Mismeasurement (search for similar items in EconPapers)
JEL-codes: D24 E22 O47 (search for similar items in EconPapers)
Date: 2021
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (10)

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Working Paper: Intangibles, Markups, and the Measurement of Productivity Growth (2021)
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Persistent link: https://EconPapers.repec.org/RePEc:eee:moneco:v:124:y:2021:i:s:p:s92-s109

DOI: 10.1016/j.jmoneco.2021.09.005

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