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Capital goods, measured TFP and growth: the case of Spain

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URI: https://hdl.handle.net/10016/25165
ISSN: 0014-2921
DOI: https://doi.org/10.1016/j.euroecorev.2015.11.009
UXXI: AR/0000017942
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capital_diaz_EER_2016_ps.pdf (2.04 MB)
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2016-04-01
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Elsevier
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Abstract
The effect of investing in equipment and/or structures on TFP and long run growth is investigated here. We argue that economies can grow in spite of stagnant TFP if the investment rate is inefficiently high. We study the case of Spain where real GDP per worker grew at 2.74 percent annually and TFP was stagnant during 1996-2007. We show that low Spanish TFP is due to low ISTC and an inefficiently high investment in residential structures. We quantify the effect of the housing boom of the 2000s, the total cost of subsidies to residential structures in terms of TFP and income growth. (C) 2016 Elsevier B.V. All rights reserved.
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Spainen, Total factor productivity, Growth accounting, Investment specific technical change, Applied general equilibrium, Technological-change; wealth distribution, Business-cycle, United-States, Productivity, Investment, Japan, Wealth distribution
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Díaz, A., Franjo, L. (2016). Capital goods, measured TFP and growth: The case of Spain. European Economic Review, v. 83, pp. 19-39.
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