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Debreu?s Coefficient of Resource Utilization, the Solow Residual, and TFP: The Connection by Leontief Preferences

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  • Thijs ten Raa

Abstract

Debreu?s coefficient of resource allocation is freed from individual data requirements. The procedure is shown to be equivalent to the imposition of Leontief preferences. The rate of growth of the modified Debreu coefficient and the Solow residual are shown to add up to TFP growth. This decomposition is the neoclassical counterpart to the frontier analytic decomposition of productivity growth into technical change and efficiency change. The terms can now be broken down by sector as well as by factor input.

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  • Thijs ten Raa, 2003. "Debreu?s Coefficient of Resource Utilization, the Solow Residual, and TFP: The Connection by Leontief Preferences," ERSA conference papers ersa03p9, European Regional Science Association.
    • Handle: RePEc:wiw:wiwrsa:ersa03p9
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    Cited by:

    1. Thijs ten Raa & Pierre Mohnen, 2009. "Competition and Performance: The Different Roles of Capital and Labor," World Scientific Book Chapters, in: Input–Output Economics: Theory And Applications Featuring Asian Economies, chapter 20, pages 371-388, World Scientific Publishing Co. Pte. Ltd..
    2. Thijs Raa, 2011. "Benchmarking and industry performance," Journal of Productivity Analysis, Springer, vol. 36(3), pages 285-292, December.
    3. Thijs ten Raa, 2012. "Performance measurement in an input-output framework," Journal of Economic Structures, Springer;Pan-Pacific Association of Input-Output Studies (PAPAIOS), vol. 1(1), pages 1-5, December.
    4. Chunding Li & John Whalley, 2014. "How Close is Asia to Already Being A Trade Bloc?," NBER Working Papers 20424, National Bureau of Economic Research, Inc.
    5. Mark Voorneveld, 2014. "From preferences to Leontief utility," Economic Theory Bulletin, Springer;Society for the Advancement of Economic Theory (SAET), vol. 2(2), pages 197-204, October.
    6. Thijs ten Raa & Victoria Shestalova, 2021. "The Solow Residual, Domar Aggregation, and Inefficiency: A Synthesis of TFP Measures," World Scientific Book Chapters, in: Efficiency and Input-Output Analyses Theory and Applications, chapter 2, pages 23-38, World Scientific Publishing Co. Pte. Ltd..
    7. Jesus Pastor & C. Lovell & Juan Aparicio, 2012. "Families of linear efficiency programs based on Debreu’s loss function," Journal of Productivity Analysis, Springer, vol. 38(2), pages 109-120, October.
    8. Li, Chunding & Whalley, John, 2017. "How close is Asia already to being a trade bloc?," Journal of Comparative Economics, Elsevier, vol. 45(4), pages 847-864.

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    More about this item

    JEL classification:

    • D24 - Microeconomics - - Production and Organizations - - - Production; Cost; Capital; Capital, Total Factor, and Multifactor Productivity; Capacity
    • O47 - Economic Development, Innovation, Technological Change, and Growth - - Economic Growth and Aggregate Productivity - - - Empirical Studies of Economic Growth; Aggregate Productivity; Cross-Country Output Convergence

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