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dc.contributor.authorBasu, Susantoen_US
dc.contributor.authorPascali, Luigien_US
dc.contributor.authorSchiantarelli, Fabioen_US
dc.contributor.authorServen, Luisen_US
dc.date.accessioned2010-02-01en_US
dc.date.accessioned2010-07-07T12:04:00Z-
dc.date.available2010-07-07T12:04:00Z-
dc.date.issued2009en_US
dc.identifier.urihttp://hdl.handle.net/10419/35902-
dc.description.abstractWe prove that the change in welfare of a representative consumer is summarized by the current and expected future values of the standard Solow productivity residual. The equivalence holds if the representative household maximizes utility while taking prices parametrically. This result justifies TFP as the right summary measure of welfare (even in situations where it does not properly measure technology) and makes it possible to calculate the contributions of disaggregated units (industries or firms) to aggregate welfare using readily available TFP data. Based on this finding, we compute firm and industry contributions to welfare for a set of European OECD countries (Belgium, France, Great Britain, Italy, Spain), using industry-level (EU-KLEMS) and firm-level (Amadeus) data. After adding further assumptions about technology and market structure (firms minimize costs and face common factor prices), we show that welfare change can be decomposed into three components that reflect respectively technical change, aggregate distortions and allocative efficiency. Then, using the appropriate firm-level data, we assess the importance of each of these components as sources of welfare improvement in the same set of European countries.en_US
dc.language.isoengen_US
dc.publisherIZA Bonnen_US
dc.relation.ispartofseriesIZA Discussion Papers 4612en_US
dc.subject.jelD24en_US
dc.subject.jelD90en_US
dc.subject.jelE20en_US
dc.subject.jelO47en_US
dc.subject.ddc330en_US
dc.subject.keywordProductivityen_US
dc.subject.keywordwelfareen_US
dc.subject.keywordreallocationen_US
dc.subject.keywordtechnologyen_US
dc.subject.keywordTFPen_US
dc.subject.stwWohlfahrtseffekten_US
dc.subject.stwWohlfahrtstheorieen_US
dc.subject.stwProduktivitäten_US
dc.subject.stwTechnischer Fortschritten_US
dc.subject.stwAllokationseffizienzen_US
dc.subject.stwMarktstrukturen_US
dc.subject.stwTheorieen_US
dc.subject.stwSchätzungen_US
dc.subject.stwBelgienen_US
dc.subject.stwFrankreichen_US
dc.subject.stwGroßbritannienen_US
dc.subject.stwItalienen_US
dc.subject.stwSpanienen_US
dc.titleProductivity, welfare and reallocation: theory and firm-level evidenceen_US
dc.typeWorking Paperen_US
dc.identifier.ppn617482764en_US
dc.rightshttp://www.econstor.eu/dspace/Nutzungsbedingungen-
Appears in Collections:IZA Discussion Papers, Forschungsinstitut zur Zukunft der Arbeit (IZA)

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