Journal of Political Economy Vol. 129 No. 1 2021
Heterogeneity, Measurement Error, and Misallocation: Evidence from African Agriculture
Abstract
Standard measures of productivity display enormous dispersion across farms in Africa. Crop yields and input intensities appear to vary greatly, seemingly in conflict with a model of efficient allocation across farms. In this paper, we present a theoretical framework for distinguishing between measurement error, unobserved heterogeneity, and potential misallocation. Using rich panel data from farms in Tanzania and Uganda, we estimate our model using a flexible specification in which we allow for several kinds of measurement error and heterogeneity. We find that measurement error and heterogeneity together account for a large fraction of the dispersion in measured productivity.
- DOI
- 10.1086/711369
- Volume
- 129
- Issue
- 1
- Pages
- 1-80
- Language
- en
- Sources
- bibtex:phds-export.bib openalex crossref