Cross-country productivity comparisons: The "revealed superiority" approach

Ziv Bar-Shira, Israel Finkelshtain, Avi Simhon*

*Corresponding author for this work

Research output: Contribution to journalArticlepeer-review

2 Scopus citations

Abstract

This paper proposes a novel non-parametric methodology for comparing total factor productivity (TFP) across countries and over time. It develops the principle of revealed superiority along the lines of Samuelson's principle of revealed preferences. Specifically, we compare the aggregate actual profits in each country to the hypothetical profits it would have earned if, facing its own prices, it had employed another country's inputs and produced its output. We show that our procedure reveals the "true" TFP ranking under relatively mild assumptions. We apply our method by ranking a panel of the 25 richest economies relative to one another and over time and find that the United States enjoys the highest TFP whereas Singapore has the lowest.

Original languageAmerican English
Pages (from-to)301-323
Number of pages23
JournalJournal of Economic Growth
Volume8
Issue number3
DOIs
StatePublished - Sep 2003

Keywords

  • Growth
  • TFP measurement

Fingerprint

Dive into the research topics of 'Cross-country productivity comparisons: The "revealed superiority" approach'. Together they form a unique fingerprint.

Cite this