The importance of total factor productivity in the system of production efficiency estimators

Abstract

Purpose: analysis of advantages and disadvantages of current approaches to research of total factor productivity (TFP), formulation of new complex definition of TFP and classification of determinants, which influences on dynamics of this estimator. Discussion: in current research we expound a brief history of total factor productivity concept development and different approaches to formulation and interpretation of TFP definition. The author analyzes issues of outstanding economists R. Solow, J. Kendrick, E. Denison, Z. Griliches, C. Hulten, which were concerned with the main points of total factor productivity concept. In addition, we did a brief review of TFP growth rate determinants. Results: Based on previous and current researches of TFP the author offer new approach to the formulation of TFP definition and classification of determinants, which can influence on this estimator.