Logomarca da FGV

Repositório FGV de Periódicos e Revistas

Development Accounting, the Elasticity of Substitution, and Non-neutral Technological Change

Marcelo de Albuquerque e Mello, André de Souza Rodrigues


We construct a broad panel with 84 countries over the period 1970-2014 with data from the Penn World Tables (PWT) 9.0. We apply the tools of development accounting to our panel. However, we depart from the traditional Cobb-Douglas hypothesis and Hicks-neutral technological change, and assume a Constant Elasticity of Substitution production function, which allows for a constant but non-unitary elasticity of substitution, and for non-neutral technological change. For different values of the elasticity of substitution, and different representation of technological change, we find that the cross-country variation in GDP per worker that can be accounted for by factor inputs is decreasing over time until the mid-2000s, when it reverses its decreasing trend. In addition, our estimates suggests that in the more recent period the proportion of the cross-country variation in GDP per worker explained by factor inputs is around 20%. Finally, we obtain similar results with broad panels from PWT versions 8.1 and 7.0, corroborating our initial findings.

Texto completo:

PDF (English)

Fundação Getulio Vargas / EPGE - Praia de Botafogo 190, 11º andar - Tel.: (21) 3799-5831


e-ISSN 0034-7140