This study proposes a "Flexible Cost Model" (FCM) for settings in which firms may be unable or unwilling to optimally manage their cost structures. FCM, which nests a wide range of more restrictive models, allows for a flexible specification not only of the technology but also of firm-level...

Recent development and growth accounting studies have established that total factor productivity is an important source of cross-country differences in income levels and growth rates. This paper makes two contributions. First, it examines the sensitivity of the development accounting results to...