Revisiting Solow’s Decomposition of Economic and Productivity Growth

Tung Liu () and Kui-Wai Li ()

No 200805, Working Papers from Ball State University, Department of Economics

Abstract: By relaxing the two assumptions of constant returns to scale and perfect competition in the product market used by Solow (1957), this paper identifies a new decomposition of economic and productivity growth. The sources of economic growth are; adjusted economies of scales effect, weighted sum of input growth, and technical progress. The sources of productivity growth are; adjusted economies of scale effect and technical progress. The weight used for the input growth is the cost share of each input.

Keywords: Solow; Growth decomposition; Total factor productivity; Returns to scale (search for similar items in EconPapers)
JEL-codes: D24 O47 (search for similar items in EconPapers)
Pages: 12 pages
Date: 2008-12, Revised 2008-12
New Economics Papers: this item is included in nep-eff and nep-fdg
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (1)

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http://econfac.bsu.edu/research/workingpapers/bsuecwp200805liu.pdf First version, 2008 (application/pdf)

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Persistent link: https://EconPapers.repec.org/RePEc:bsu:wpaper:200805

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