Journal of Political Economy Vol. 96 No. 1 1988
A General Index of Technical Change
Abstract
This paper outlines a procedure for estimating a general index of technical change within the context of a quite general production technology. Specifically, when panel data are available for firms in an industry, time-specific dummies can be combined in a nonlinear estimation procedure to yield a general index of technical change that may be both nonneutral and scale augmenting. This approach offers numerous advantages over the traditional time trend representation of technical change. For example, the general index can serve as the basis for analysis of the determinants of technical change. Results for a sample of 30 electric utilities over the period 1951-78 show that the productivity decline of the 1970s can be attributed primarily to sulphur oxide restrictions and secularly declining capacity utilization due to rapidly increasing peak-load demands.
- DOI
- 10.1086/261522
- Volume
- 96
- Issue
- 1
- Pages
- 20-41
- Language
- en
- Sources
- openalex crossref