Using Micro Data to Understand Macro Aggregates
Saturday, Jan. 5, 2019 2:30 PM - 4:30 PM
- Chair: Stephen James Redding, Princeton University
Measuring Productivity: Lessons from Researcher Designed Surveys
AbstractThis paper explores the relationship between revenue and quantity productivity estimated using standard methods from typical firm-level surveys. As is well known, standard measures are confounded by quality differences, markups, and the fact that even single-industry firms produce many products. We draw on detailed firm-product-level data that was designed to account for these potential confounds to estimate TFPQ and TFPR. We further compare firm-level estimates with direct measures of firm productivity collected in a lab setting. We use our findings to provide guidance to researchers using standard datasets to infer productivity.
Aggregation and the Gravity Equation
AbstractIn a wide class of economic models, the impact of country participation in the global economy on welfare is summarized by import price indexes. Using data from the World Integrated Trade Solution (WITS) database, we provide new evidence on the evolution of import price indexes across countries, industries and over time. We use the new exact price index (the unified price index) for the CES demand system from Redding and Weinstein (2016), which allows for the non-conventional forces of variety, demand/quality and heterogeneity across goods, as well as the conventional forces of price. We show that our model-consistent import price indexes diverge substantially from standard statistical measures of import price indexes, highlighting larger contributions of trade to welfare than conventionally measured.
- O4 - Economic Growth and Aggregate Productivity
- F6 - Economic Impacts of Globalization