The study considers a stochastic R&D process where the invented production technologies consist of a large number n of complementary components. The degree of complementary is captured by the elasticity of substitution of the CES aggregator function. Drawing from the Central Limit Theorem and...

We construct 14 alternative measures of technological progress for 19 OECD countries over the period 1970–2000, distinguishing between measures of productivity gains actually obtained in a given country (TFP growth, Malmquist index) and technological progress at the world technology frontier...