Description

This study makes several important contributions to the existing empirical literature in terms of both data and methodology. First, our measure of TFP is adjusted for heterogeneous quality of labour and different vintages of capital assets which helps us in improving the reliability of our elasticity estimates.4 Second, as discussed above, the estimated elasticity of infrastructure is quite sensitive towards the estimator applied, hence, we use a bootstrap panel cointegration test that helps us to control for both sectoral dependencies and serial correlation.