This paper adopts the technique of DiNardo, Fortin and Lemieux (1996) to decompose differences in the distribution of PISA test scores in Canada, and assesses the relative contribution of differences in the distribution of “class size” and time-in-term, other school factors and student...

This Economic Letter examines measurement of potential output, focusing on how big the output gap—and the resulting downward pressure on inflation—is today.

Potential output is an important concept in economics. Policymakers often use a one-sector neoclassical model to think about long-run growth, and often assume that potential output is a smooth series in the short run--approximated by a medium- or long-run estimate. But in both the short and long...