Growth Accounting*

Charles R. Hulten

Chapter Chapter 23 in Handbook of the Economics of Innovation, 2010, vol. 2, pp 987-1031 from Elsevier

Abstract: Incomes per capita have grown dramatically over the past two centuries, but the increase has been unevenly spread across time and across the world. Growth accounting is the principal quantitative tool for understanding this phenomenon, and for assessing the prospects for further increases in living standards. This paper sets out the general growth accounting model, with its methods and assumptions, and traces its evolution from a simple index-number technique that decomposes economic growth into capital-deepening and productivity components, to a more complex account of the growth process. In the more complex account, capital and productivity interact, both are endogenous, and quality change in inputs and output matters. New developments in micro-level productivity analysis are also reviewed, and the long-standing question of net versus gross output as the appropriate indicator of economic growth is addressed.

Keywords: growth accounting; Solow residual; sources of growth; technical change; total factor productivity (search for similar items in EconPapers)
JEL-codes: E01 O47 (search for similar items in EconPapers)
Date: 2010
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Citations: View citations in EconPapers (9)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:haechp:v2_987

DOI: 10.1016/S0169-7218(10)02007-1

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