Five ways to price capital services and what it means for measuring productivity : This book examines how different rental price formulas shape estimates of multifactor productivity, a key metric for understanding economic growth.
The discussion centers on five alternative capital rental price measures and how each one affects the growth accounting of MFP. It also walks through a practical empirical comparison using a large data set across U.S. manufacturing industries, highlighting the implications for policy and research.
- How rental price formulas are derived from theory and used in practice
- What changes in asset prices, capital gains, and rates of return do to MFP estimates
- Three quantitative measures for comparing rental price approaches (composition, volatility, and negatives)
- Observed patterns across industries and time periods, with guidance for choosing a method
Ideal for readers of productivity measurement, macroeconomics, and statistical methods who want a clear view of how rental prices influence capital services and growth accounting.