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  • J. Rodrigo Fuentes (a1) and Marco Morales (a2)


Despite the important role that total factor productivity (TFP) has played in the growth literature, few attempts have been made to change the methodology to estimate it. This paper proposes a methodology based on a state-space model to estimate TFP and its determinants. With this methodology, it is possible to reduce the measurement of our ignorance. As a by-product, this estimate yields the capital share in output and the long-term growth rate. When applied to Chile, the estimation shows a capital share around 0.5 and long-term growth of TFP around 1%. Capital accumulation tends to explain the growth rate in the fast growth periods under the econometric estimation more than the traditional growth accounting methodology.


Corresponding author

Address correspondence to: J. Rodrigo Fuentes, Instituto de Economía, Pontificia Universidad Católica de Chile Avda. Vicuña Mackenna 4860, Macul, Santiago, Chile; e-mail:


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  • J. Rodrigo Fuentes (a1) and Marco Morales (a2)


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