TY  - JOUR
AU  - Caselli,Francesco
TI  - Accounting for Cross-Country Income Differences
JF  - National Bureau of Economic Research Working Paper Series
VL  - No. 10828
PY  - 2004
Y2  - October 2004
UR  - http://www.nber.org/papers/w10828
L1  - http://www.nber.org/papers/w10828.pdf
N1  - Author contact info:
Francesco Caselli
Department of Economics
London School of Economics
Houghton Street
London WC2A 2AE
UNITED KINGDOM
Tel: (44) (0) 2079557498
E-Mail: f.caselli@lse.ac.uk
AB  - Why are some countries so much richer than others? Development Accounting is a first-pass attempt at organizing the answer around two proximate determinants: factors of production and efficiency. It answers the question "how much of the cross-country income variance can be attributed to differences in (physical and human) capital, and how much to differences in the efficiency with which capital is used?" Hence, it does for the cross-section what growth accounting does in the time series. The current consensus is that efficiency is at least as important as capital in explaining income differences. I survey the data and the basic methods that lead to this consensus, and explore several extensions. I argue that some of these extensions may lead to a reconsideration of the evidence.
ER  -