Intangibles, Markups, and the Measurement of Productivity Growth

Nicolas Crouzet and Janice Eberly

No 29109, NBER Working Papers from National Bureau of Economic Research, Inc

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.

JEL-codes: D24 D4 E01 E22 G31 (search for similar items in EconPapers)
Date: 2021-07
New Economics Papers: this item is included in nep-eff, nep-isf, nep-knm and nep-mac
Note: CF EFG PR
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Citations: View citations in EconPapers (17)

Published as Nicolas Crouzet & Janice Eberly, 2021. "Intangibles, markups, and the measurement of productivity growth," Journal of Monetary Economics, .

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