The traditional emphasis on breaking down output growth according to growth in inputs and growth in TFP is misplaced. More appropriately, we should break it down according to changes in "efficiency" and "technology". These two are equilibrium concepts, rather than purely technical properties of...

We analyse the impact of human capital misallocation and redistribution on GDP, welfare, and TFP, in economies with financial market imperfections. We present an overlapping generations model in which the innate abilities of children are drawn from a probability distribution and where parents...