--- canonical_url: "https://csls.ca/ipm-archive/ipm-issue-24/rejoinder-to-gu-on-estimating-capital-input-for-measuring-business-sector-multifactor-productivity-growth-in-canada/" title: "Rejoinder to Gu on ‘Estimating Capital Input for Measuring Business Sector Multifactor Productivity Growth in Canada’" author: name: "CSLS" url: "https://csls.ca/author/cslc/" date_published: "2026-07-13T07:33:50+00:00" date_modified: "2026-07-13T07:33:50+00:00" post_type: "ipm" summary: "" ipm_issue_period: - "Fall 2012" ipm_keyword: - "balancing rate of return" - "Canada" - "capital gains" - "capital services" - "methodology" - "MFP" - "rejoinder" - "Statistics Canada" - "user costs" ipm_research_theme: - "Measurement and methodology" ipm_country_focus: - "Canada" featured_image: "https://csls.ca/wp-content/uploads/2026/06/IPM_50_banner.webp" status: "publish" --- # Rejoinder to Gu on ‘Estimating Capital Input for Measuring Business Sector Multifactor Productivity Growth in Canada’ Canonical URL: https://csls.ca/ipm-archive/ipm-issue-24/rejoinder-to-gu-on-estimating-capital-input-for-measuring-business-sector-multifactor-productivity-growth-in-canada/ # Rejoinder to Gu on ‘Estimating Capital Input for Measuring Business Sector Multifactor Productivity Growth in Canada’ [Download full PDF article](https://csls.ca/wp-content/uploads/2026/07/IPM-Issue-24-4-Diewert.pdf) Cite this article × Cite this article as: Diewert, Erwin. 2012. “Rejoinder to Gu on ‘Estimating Capital Input for Measuring Business Sector Multifactor Productivity Growth in Canada’.” International Productivity Monitor, No. 24 (Fall 2012): 63–72. https://www.csls.ca/ipm-archive/ipm-issue-24/rejoinder-to-gu-on-estimating-capital-input-for-measuring-business-sector-multifactor-productivity-growth-in-canada/ ## Author: - Erwin Diewert Department of Economics, University of British Columbia ## IPM Issue 24 Fall 2012 pp. 63–72 ## Related IPM articles [The Relationship between Efficiencies Defenses for Mergers and TFP Growth Robin Shaban Fall 2025 | IPM Issue 49 | pp. 82–102](https://csls.ca/ipm-archive/ipm-issue-49/the-relationship-between-efficiencies-defenses-for-mergers-and-tfp-growth/) [Appendix: Variable Definitions and Country/Sector Coverage for Regulatory Reform Analysis Gilbert Cette, Jimmy Lopez, Giuseppe Nicoletti, Océane Vernerey Fall 2025 | IPM Issue 49 | pp. 1–18](https://csls.ca/ipm-archive/ipm-issue-49/appendix-variable-definitions-and-country-sector-coverage-for-regulatory-reform-analysis/) [The Potential Impact of Pro-competitive Regulatory Reforms on Productivity and Growth in Canada Gilbert Cette, Jimmy Lopez, Giuseppe Nicoletti, Océane Vernerey Fall 2025 | IPM Issue 49 | pp. 3–40](https://csls.ca/ipm-archive/ipm-issue-49/the-potential-impact-of-pro-competitive-regulatory-reforms-on-productivity-and-growth-in-canada/) [IPM Issue 49 Editors’ Overview Andrew Sharpe, Bart van Ark, Paul Schreyer Fall 2025 | IPM Issue 49 | pp. 1–2](https://csls.ca/ipm-archive/ipm-issue-49/) [ONS Response to ‘Are UK Regional Productivity Disparities Really Narrowing?’ Richard Prothero Spring 2025 | IPM Issue 48 | pp. 85–89](https://csls.ca/ipm-archive/ipm-issue-48/ons-response-to-are-uk-regional-productivity-disparities-really-narrowing/) [Using Ecosystem Accounting to Integrate the Environment in Measures of Multifactor Productivity Carl Obst Fall 2024 | IPM Issue 47 | pp. 87–108](https://csls.ca/ipm-archive/ipm-issue-47/using-ecosystem-accounting-to-integrate-the-environment-in-measures-of-multifactor-productivity/) [Eroding Natural Capital: An Alternative Explanation for the Secular Decline in Productivity Growth Christina Caron Fall 2024 | IPM Issue 47 | pp. 109–147](https://csls.ca/ipm-archive/ipm-issue-47/eroding-natural-capital-an-alternative-explanation-for-the-secular-decline-in-productivity-growth/) [Climate Change and Productivity — An Exploration Dirk Pilat Fall 2024 | IPM Issue 47 | pp. 54–86](https://csls.ca/ipm-archive/ipm-issue-47/climate-change-and-productivity-an-exploration/) [How Does Industrial Policy Impact Output, Hours and Productivity? The Canadian Experience Tim Sargent Fall 2024 | IPM Issue 47 | pp. 39–53](https://csls.ca/ipm-archive/ipm-issue-47/how-does-industrial-policy-impact-output-hours-and-productivity-the-canadian-experience/) [Accounting for the Decline of Canada’s Real GDP Per Capita since Mid-2022 Philip Smith Spring 2024 | IPM Issue 46 | pp. 83–100](https://csls.ca/ipm-archive/ipm-issue-46/accounting-for-the-decline-of-canadas-real-gdp-per-capita-since-mid-2022/) ## Abstract ## Résumé EN FR Copy link Email LinkedIn This rejoinder responds to the comments of Wulong Gu (2012) on the article by Diewert and Yu (2012). The paper lays out the algebra behind the Diewert-Yu capital services methodology and the corresponding methodology used by the Statistics Canada Canadian Productivity Program. The large differences in the estimates can mainly be explained by different treatments of the expected capital gains term in user costs and the use of sectoral balancing rates of return versus economy-wide balancing rates of return. RÉSUMÉ Cette réplique répond aux commentaires de Wulong Gu (2012) sur l’article d’Erwin Diewert et Emily Yu (2012). L’article examine les calculs algébriques pour les méthodologies pour estimer les services de capital utilisés par Diewert-Yu et par le programme canadien de la productivité. Les grands écarts dans les estimations s’expliquent principalement par les traitements différents du terme des gains en capital escomptés dans les coûts de l’utilisation du capital et l’utilisation des taux de rendement sectoriel par rapport à a un taux de rendement a l’échelle de l’économie. WULONG G U (2012) HAS PROVIDED a very Cette réplique répond aux commentaires de Wulong Gu (2012) sur l’article de Diewert et Yu (2012). L’article expose l’algèbre sous-jacente à la méthodologie des services du capital de Diewert-Yu et à la méthodologie correspondante utilisée par le Programme canadien de la productivité de Statistique Canada. Les grandes différences dans les estimations peuvent s’expliquer principalement par des traitements différents du terme de gains en capital anticipés dans les coûts d’utilisation et par l’utilisation de taux de rendement d’équilibre sectoriels par opposition aux taux de rendement d’équilibre à l’échelle de l’économie. [Download full PDF](https://csls.ca/wp-content/uploads/2026/07/IPM-Issue-24-4-Diewert.pdf)