Heterogeneity, measurement error, and misallocation: Evidence from african agriculture

Douglas Gollin, Christopher Udry

Research output: Contribution to journalArticlepeer-review

5 Scopus citations

Abstract

Standard measures of productivity display enormous dispersion across farms in Africa. Crop yields and input intensities appear to vary greatly, seemingly in conflict with a model of efficient allocation across farms. In this paper, we present a theoretical framework for distinguishing between measurement error, unobserved heterogeneity, and potential misallocation. Using rich panel data from farms in Tanzania and Uganda, we estimate our model using a flexible specification in which we allow for several kinds of measurement error and heterogeneity. We find that measurement error and heterogeneity together account for a large fraction of the dispersion in measured productivity.

Original languageEnglish (US)
Pages (from-to)1-80
Number of pages80
JournalJournal of Political Economy
Volume129
Issue number1
DOIs
StatePublished - Jan 2021

ASJC Scopus subject areas

  • Economics and Econometrics

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