Capital Misallocation and Aggregate Factor Productivity

We propose a sectoral-shift theory of aggregate factor productivity for a class of economies with AK technologies, limited loan enforcement, a constant production possibilities frontier, and finitely many sectors producing the same good. Both the growth rate and total factor productivity in these economies respond to random and persistent endogenous fluctuations in the sectoral distribution of physical capital which, in turn, responds to persistent and reversible exogenous shifts in relative sector productivities. Surplus capital from less productive sectors is lent to more productive ones in the form of secured collateral loans, as in Endogenous debt limits slow down capital reallocation, preventing the equalization of riskadjusted equity yields across sectors. Economy-wide factor productivity and the aggregate growth rate are both negatively correlated with the dispersion of sectoral rates of return, sectoral TFP and sectoral growth rates. If sector productivities follow a symmetric two-state Markov process, many of our economies converge to a limit cycle alternating between mild expansions and abrupt contractions. We also find highly periodic and volatile limit cycles in economies with small amounts of collateral.

We propose a sectoral-shift theory of aggregate factor productivity for a class of economies with AK technologies, limited loan enforcement, and a constant production possibilities frontier. Both the growth rate and TFP respond to random and persistent endogenous fluctuations in the sectoral distribution of physical capital which, in turn, responds to reversible exogenous shifts in relative sector productivities. Surplus capital from less productive sectors is lent to more productive ones in the form of secured collateral loans, as in Endogenous debt limits slow down capital reallocation, preventing the equalization of risk-adjusted equity yields across sectors. Economy-wide factor productivity and the aggregate growth rate are both negatively correlated with the dispersion of sectoral rates of return, sectoral TFP and sectoral growth rates. We also find highly volatile limit cycles in economies with small amounts of collateral.

We propose a sectoral–shift theory of aggregate factor productivity for a class of multisector economies with AK technologies and a constant production possibilities frontier. Loans are partly secured by collateral and partly based on reputation. We find that both the growth rate and total factor productivity (TFP) respond to random and persistent endogenous fluctuations in the sectoral distribution of physical capital, which, in turn, responds to reversible exogenous shifts in relative sector productivities. Endogenous debt limits on secured and unsecured loans slow down capital reallocation, preventing the equalization of risk-adjusted equity yields across sectors. Economywide factor productivity and the aggregate growth rate are both negatively correlated with the dispersion of sectoral rates of return, sectoral TFP, and sectoral growth rates. We also find highly volatile limit cycles in economies with small amounts of collateral.

where G is the growth rate of aggregate demand, and gi and Ei are the actual growth rate and the income elasticity of output for the ith sector respectively. GEi is defined as the expected growth rate of the ilh sector.2 Measure (2) is preferred to (1) as the latter is unnecessarily sensitive to extreme deviations in sectoral growth rates. Swamy then correlated both measures of imbalance with the aggregate growth rate, G. Coefficients were positive and statistically significant for all periods except 1938-1948. He concludes that the 'statistical evidence does not corroborate the balanced growth theory.' 3 Swamy's results have to be interpreted carefully. In the first place there are weaknesses in the statistical techniques he adopts. These result from his reliance on the correlation between G and V. This correlation is questionable on two counts. Firstly, where the k sectors form a large proportion of aggregate output, we would expect high sectoral growth rates to be accompanied by a high growth of overall output. The association between V and G merely reflects a mutual component in both (i.e., gi). However, since Swamy disaggregated into 13 manufacturing sectors, this spurious element may not be important. Secondly, variations in G automatically affect V since one of the elements of the latter is GEi. This will generate a positive correlation between G and V when the sign of (gi GEj) is negative (and a negative correlation when the sign is positive). Take the limiting case,

Computer simulation was carried out to elucidate the growth rate and morphological change of aggregates in flocculation with compaction of monodisperse system by a procedure based on a two-dimensional geometrical random coalescence model. Aggregates were packed closely by partial rotation of the cluster constituting the aggregate when aggregates were flocculated (compaction A) or during measurement of flocculation time (compaction B). Flocculation kinetics were in good agreement with Smoluchowski's flocculation theory. In both compaction methods, the aggregates were packed closely, so that parameters such as the compaction probability and frequency would apply. The aggregates formed by flocculation had hollow structures resembling thick trunks and/or loop structures when they became large. The growth rate of aggregates followed second-order kinetics in both methods. The growth rate constant did not vary with compaction probability in compaction A, but became minimal when the product of compaction probability and compaction frequency was approximately 0.5 in compaction B. Changes in anisometry of aggregates were different for the two methods, that in anisometry simulated by compaction B was more consistent with the date for actual flocculation from a two-dimensional model experiment than change in this parameter simulated by compaction A.

Population balance modeling of aggregation kinetics of recombinant human interleukin-1 receptor antagonist

Productivity growth and labor reallocation: Latin America versus East Asia

Looking Beyond the Methods: Productivity Estimates and Growth Trends in Indian Manufacturing

Telecommunications and growth: The contribution of telecommunications infrastructure investment to aggregate and sectoral productivity

A Welfare-Based Approach to Aggregating Growth Rates Across Countries

Abstract.Aggregating per capita gross domestic product growth across countries has always been a technical problem because of the complexities in the relative movements of exchange rates, economic output and populations. As such, the conventional approach to aggregating growth across countries suffers from sensitivity to exchange rates, as well as from the possibility of aggregate growth rates not being convex combinations of individual growth rates. This article introduces a new methodology in aggregating per capita growth rates that does not suffer from the drawbacks of the conventional approach. Using a welfare‐based approach, it is shown that the proposed methodology is robust w.r.t. exchange rates and generates weights that always add up to unity, thus avoiding the anomalies that are inherent in the conventional approach. The methodology proposed in the article is applied to calculate aggregate growth rates of 33 developing member countries as well as five regional groupings, and the results are compared with those arising from the conventional approach. A number of insights arise that were previously hidden or inaccessible.

Platelet aggregation in flowing blood in vitro. II. Dependence of aggregate growth rate on ADP concentration and shear rate

Engines of growth in the US economy

This paper analyzes the main forces related to the declining agricultural employment in the Brazilian economy, and its contribution to country s economic growth for the period 1970-2015. We employ a novel three sector growth accounting exercise, and a multisector growth model to estimate the various economic forces that serve to pull and push labor out of agriculture. Our results supports the conclusion that agriculture, whose rate of TFP growth tends to dominate that of the industrial and service sector, has had two roles on recent economic growth: the first is associated to TFP growth, and second is the labor transference to other sectors, and more specifically to the service sector. We also find evidence of sectoral TFP correlation suggesting technological spill over between sectors. Acknowledgement :

This paper traces Pakistan’s TFP and GDP growth from 1972 to 2021. The analysis shows that Pakistan’s TFP and economic growth have declined over time. The sectoral—agriculture, industry, and services—trends are also not different. The TFP and GDP growth rates of the total economy and the three sectors were the highest in the 1980s. In general, whenever TFP growth has increased, Pakistan’s economic growth has also increased. The analysis further shows that whenever attempts were made to deregulate and liberalise the economy, it resulted in higher TFP growth and consequently higher GDP growth. Similarly, macroeconomic and political stability also seems to be important factors in higher TFP and GDP growth. The comparison with other countries shows that Pakistan’s TFP growth performance has been reasonable, especially when compared with India. At the same time, however, the experience of other countries shows that to achieve GDP growth above 8 percent, Pakistan needs to enhance its productivity growth to 3 percent or above.