Productive Efficiency in 16 European Countries

We investigate in this paper differences in productive efficiency across sixteen European countries. In order to assess differences in productive efficiency, we have built a dynamic input-output model and computed for each country the balanced growth rate and the balanced output composition. After that, we investigate how the differences existing between the output composition for balanced growth and the actual one relate to the differences between the rate of balanced growth and the actual one. In the final part of the paper we examine the influence of individual sectors on the rate of balanced growth by looking for growth-sensitive sectors.