A Model of TFP
This paper proposes an aggregative model of Total Factor Productivity (TFP) in the spirit of Houthakker (1955-1956). It considers a frictional labor market where production units are subject to idiosyncratic shocks and jobs are created and destroyed as in Mortensen and Pissarides (1994). An aggregate production function is derived by aggregating across production units in equilibrium. The level of TFP is explicitly shown to depend on the underlying distribution of shocks as well as on all the characteristics of the labor market as summarize by the job-destruction decision. The model is also used to study the effects of labor-market policies on the level of measured TFP.
Year of publication: |
2001
|
---|---|
Authors: | Lagos, R. |
Institutions: | C.V. Starr Center for Applied Economics, Department of Economics |
Saved in:
freely available
Saved in favorites
Similar items by person
-
An alternative approach to market frictions : an application to the market for taxicab rides
Lagos, Ricardo, (1996)
-
Liquidity in asset markets with search frictions
Lagos, Ricardo, (2008)
-
Money and capital as competing media of exchange
Lagos, Ricardo, (2008)
- More ...