Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/125547
Authors: 
Shenoy, Ajay
Year of Publication: 
2015
Series/Report no.: 
Working Papers, UC Santa Cruz Economics Department 724
Abstract: 
I develop a method to measure and separate the production misallocation caused by failures in factor markets versus financial markets. When I apply the method to rice farming villages in Thailand I find surprisingly little misallocation. Optimal reallocation would increase output in most villages by less than 15 percent. By 2006 most misallocation comes from factor market failures. I derive a decomposition of aggregate growth that accounts for misallocation. Declining misallocation contributes little to growth compared to factor accumulation and rising farm productivity. I use a government credit intervention to test my measures. I confirm that credit causes a statistically significant decrease in only financial market misallocation.
Subjects: 
misallocation
market failure
Thailand
agriculture
financial markets
factor markets
JEL: 
O47
O16
E13
Document Type: 
Working Paper

Files in This Item:
File
Size
627.67 kB





Items in EconStor are protected by copyright, with all rights reserved, unless otherwise indicated.