| 来源类型 | Discussion paper |
| 规范类型 | 论文 |
| 来源ID | DP11399 |
| DP11399 Production Function Estimation with Measurement Error in Inputs | |
| Jan De Loecker; Allan Collard-Wexler | |
| 发表日期 | 2016-07-19 |
| 出版年 | 2016 |
| 语种 | 英语 |
| 摘要 | Production functions are a central component in a variety of economic analyzes. However, these production functions often first need to be estimated us- ing data on individual production units. There is reason to believe that, more than any other input in the production process, there are severe errors in the recording of capital stock. Thus, when estimating production functions, we need to account for the ubiquity of measurement error in capital stock. This paper shows that commonly used estimation techniques in the productivity literature fail in the presence of plausible amounts of measurement error in capital. We propose an estimator that addresses this measurement error, while controlling for unobserved productivity shocks. Our main insight is that investment expenditures are informative about a producer’s capital stock, and we propose a hybrid IV-Control function approach that instruments capital with (lagged) investment, while relying on standard intermediate input de- mand equations to offset the simultaneity bias. We rely on a series of Monte Carlo simulations and find that standard approaches yield downward-biased capital coefficients, while our estimator does not. We apply our estimator to two standard datasets, the census of manufacturing firms in India and Slove- nia, and find capital coefficients that are, on average, twice as large. |
| 主题 | Industrial Organization ; International Trade and Regional Economics |
| 关键词 | Production function Measurement error inputs |
| URL | https://cepr.org/publications/dp11399 |
| 来源智库 | Centre for Economic Policy Research (United Kingdom) |
| 资源类型 | 智库出版物 |
| 条目标识符 | http://119.78.100.153/handle/2XGU8XDN/540213 |
| 推荐引用方式 GB/T 7714 | Jan De Loecker,Allan Collard-Wexler. DP11399 Production Function Estimation with Measurement Error in Inputs. 2016. |
| 条目包含的文件 | 条目无相关文件。 | |||||
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