rates of total factor productivity in distinct consumption- and investmentgoods- producing technologies. This model … attributes most of the productivity slowdown of the 1970s to the consumption-goods sector; it suggests that a slowdown in the …

values of the standard Solow productivity residual. The equivalence holds if the representative household maximizes utility … while taking prices parametrically. This result justifies total factor productivity (TFP) as the right summary measure of …