Is potential output growth falling?

Mendieta-Muñoz, Ivan (2015): Is potential output growth falling?

Abstract

We estimate the rate of growth consistent with a stable unemployment rate for four advanced economies (Canada, Germany, the United Kingdom and the United States) using a Heckman-type two step estimation procedure that deals with the issue of endogenous regressors in a time-varying parameter model. The results show that this rate of growth of potential output has been falling in the four countries of study, so that these countries have been systematically loosing capacity to grow during the postwar era.

• Item Type: MPRA Paper
• Language: English
• Keywords: potential output growth rate, constant unemployment rate, time-varying parameter models
• Subjects: C - Mathematical and Quantitative Methods > C5 - Econometric Modeling > C50 - General; O - Economic Development, Innovation, Technological Change, and Growth > O4 - Economic Growth and Aggregate Productivity > O40 - General; O - Economic Development, Innovation, Technological Change, and Growth > O4 - Economic Growth and Aggregate Productivity > O49 - Other

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