Principles of Macroeconomics / Unit 4 MAC 0314 short lesson, about 20 seconds
Growth Accounting
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The idea
Growth accounting measures how much of growth the counted inputs explain and attributes the leftover to technology. That leftover is usually the largest share.
In practice
American studies put input quantity at roughly two thirds of growth, and quality and technology at the rest.
Where people slip
The residual is what the method could not measure, so calling it technology is an inference, not a measurement.
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