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José-María Da-Rocha |
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Policy Distortions and Aggregate Productivity with Endogenous Establishment-Level Productivity with D. Restuccia and M. M. Tavares, forthcoming European Economic Review What accounts for income per capita and total factor productivity (TFP) differences across countries? We study resource misallocation across heterogeneous production units in a general equilibrium model where establishment productivity and size are affected by policy distortions. We solve the model in closed form and show that policy distortions have a substantial negative effect on establishment productivity growth, average establishment size, and aggregate productivity. Calibrating a distorted benchmark economy to U.S. data, we find that empirically reasonable variations in distortions generate reductions in aggregate TFP of more than 24 percent while slightly increasing concentration in the establishment size distribution. If distortions in addition lower the exit rate of incumbent establishments, as supported by some empirical evidence, the aggregate TFP loss doubles to 48 percent. |
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Firing Costs, Misallocation, and Aggregate Productivity with D. Restuccia and M.M. Tavares, Journal of Economic Dynamics and Control 68, 60-81 (2019) - click here.
The Productivity Cost of Sovereign Default: Evidence from the European Debt Crisis. with J. Alonso, and E. Colla Economic Theory 64: 611-633 (2017) - click here.
Why Fertility and Female Participation Rates are Positively Correlated across OECD countries? with L. Fuster, International Economic Review 47(4): 1187-1222 (2006) - click here.
The Role of Agriculture in Aggregate Business Cycles with D. Restuccia, Review of Economic Dynamics 9(3): 455-483(2006) - click here.
Contact jmrocha@uvigo.es