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Accounting for Cross-Country Income Differences
Open accessAbstract
Why are some countries so much richer than others?Development Accounting is a first-pass attempt at organizing the answer around two proximate determinants: factors of production and efficiency.It answers the question ``how much of the cross-country income variance can be attributed to differences in (physical and human) capital, and how much to differences in the efficiency with which capital is used?''Hence, it does for the cross-section what growth accounting does in the time series.The current consensus is that efficiency is at least as important as capital in explaining income differences.I survey the data and the basic methods that lead to this consensus, and explore several extensions.I argue that some of these extensions may lead to a reconsideration of the evidence.
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Cites
The Penn World Table (Mark 5): An Expanded Set of International Comparisons, 1950-1988
Summers, R., & Heston, A. (1991) · The Quarterly Journal of Economics · doi:10.2307/2937941 · Cited by 3,429
Gollin, D. (2002) · Journal of Political Economy · doi:10.1086/338747 · Cited by 1,977
Duflo, E. (2001) · American Economic Review · doi:10.1257/aer.91.4.795 · Cited by 1,940
Carneiro, P. M., & Heckman, J. J. (2003) · doi:10.2139/ssrn.434544 · Cited by 1,325
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Bloom, N., & Van Reenen, J. M. (2006) · SSRN Electronic Journal · doi:10.2139/ssrn.922368 · Cited by 836
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Alder, S., Shao, L., & Zilibotti, F. (2016) · Journal of Economic Growth · doi:10.1007/s10887-016-9131-x · Cited by 435
Metadata
- Authors
- Caselli, F.
- Venue
- National Bureau of Economic Research
- Publisher
- National Bureau of Economic Research
- Published
- 2004-10
- OpenAlex
- W2111103143
- Cited by
- 416
- References
- 4
- Type
- report
- Language
- en
- Open access
- green
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