Accounting for Taiwan GDP Growth: Parametric and Nonparametric Estimates

The purpose of this paper is to study the impact of changes in prices of tradables on economic growth in a highly open economy, Taiwan. We do so by measuring productivity growth with both index number and parametric approaches, and identifying the sources of output growth using a methodology that allows the impacts of changes in the terms of trade to be accounted for. The results show that Taiwan’s economic growth depends on inputs accumulation as well as technical progress with the terms-of-trade effect being negligible