Language:
English
Pages:
43 p.
,
21 x 29.7cm
Series Statement:
OECD Economics Department Working Papers no.273
Keywords:
Economics
;
Japan
;
United States
Abstract:
In many industries, competition is far from perfect and managerial efficiency (or a fixed cost) varies among firms. However, traditional measurement of technological progress assumes perfect competition and no fixed cost. This paper incorporates these two factors in the technological-progress measurement and investigates the biases caused by their omission. We show that if capital growth exceeds non-capital-input growth and that firms earn a positive pure profit, then traditional measurement underestimates the true technological progress. We apply this methodology to Japanese and US industries, and find that imperfect competition and managerial efficiency are important. However, the magnitude of the bias is not large ...
DOI:
10.1787/260256735077
