MACROECONOMIC DETERMINANTS OF TOTAL FACTOR PRODUCTIVITY: NEW GENERATION PANEL DATA ANALYSIS ON OECD COUNTRIES (1996-2015)

Abstract

Determining the factors which are effective on total factor productivity (TFP) increments include the productivity of all factors in the production process and making improvements for these factors via policies have importance concerning speed the potential growth rate up in the long term and making this sustainable. The mediumlong term determinants of TFP are examined in this research for the 1994-2015 period as econometric within the scope of new generation panel data analysis on the OECD countries who are classified as OECD-1 and OECD-2 by their income levels. From this aspect, purposed in this research that to reveal the primary determinants which cause the differentiations between OECD-1 and OECD-2 countries in terms of their long-term economic growth performances and/or income levels. Determined as a result of the research that the effect of the variables which are used to determine the medium-long term determinants of the TFP on OECD-1 and OECD-2 groups parallelly increased and decreased as long as enhancing the representation degree of the knowledge, innovation and technological development level of the variables. These results show that the differentiation of countries in OECD-1 and OECD-2 groups in terms of long-term economic growth and/or income levels is majorly rooted in indicators which are used on behalf of knowledge, innovation, and technological development.

Keywords

• TFP
• Sustainable Growth
• Knowledge
• Innovation and Technological Development
• OECD Countries
• New Generation Panel Data Analysis