Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/180955
Authors: 
Li, Mengheng
Mendieta-Muñoz, Ivan
Year of Publication: 
2018
Series/Report no.: 
Working Paper 2018-02
Abstract: 
This paper studies the evolution of long-run output and labour productivity growth rates in the G-7 countries during the post-war period. We estimate the growth rates consistent with a constant unemployment rate using time-varying parameter models that incorporate both stochastic volatility and a Heckman-type two-step estimation procedure that deals with the possible endogeneity problem in the econometric models. The results show a significant decline in long-run growth rates that is not associated with the detrimental effects of the Great Recession, and that the rate of growth of labour productivity appears to be behind the slowdown in long-run GDP growth.
Subjects: 
long-run output growth rates
unobserved components
Kalman filter
timevarying parameter models
stochastic volatility
Heckman two-step bias correction
JEL: 
O41
O47
C15
C32
Document Type: 
Working Paper
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