Download now Free registration required
In this paper, the authors set out a model of labor productivity which distinguishes between shocks which change productivity permanently and shocks which have transient affects on productivity. They show that this model is a type of unobserved components model - a random walk with drift plus noise model. The advantage of this approach is that it provides a coherent framework to identify the deterministic trend growth component and also the productivity-enhancing (or technology-related) stochastic components.
- Format: PDF
- Size: 357.1 KB