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Cyclical Productivity in Europe and the United States, Evaluating the Evidence on Returns to Scale and Input Utilization

Robert Inklaar

No 5501, CEPR Discussion Papers from C.E.P.R. Discussion Papers

Abstract: This paper studies procyclical productivity growth at the industry level in the U.S. and in three European countries (France, Germany and the Netherlands). Industry-specific demand-side instruments are used to examine the prevalence of non-constant returns to scale and unmeasured input utilization. For the aggregate U.S. economy, unmeasured input utilization seems to explain procyclical productivity. However, this correction still leaves one in three U.S. industries with procyclical productivity. This failure of the model can also be seen in Europe and is mostly concentrated in services industries.

Keywords: Cyclical productivity; Input utilizations; Returns to scale; Instrumental variables (search for similar items in EconPapers)
JEL-codes: D24 E32 O47 (search for similar items in EconPapers)
Date: 2006-02
New Economics Papers: this item is included in nep-eff and nep-mac
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (7)

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Journal Article: Cyclical Productivity in Europe and the United States: Evaluating the Evidence on Returns to Scale and Input Utilization (2007) Downloads
Working Paper: Cyclical productivity in Europe and the United States, evaluating the evidence on returns to scale and input utilization (2005) Downloads
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