Data and Code for: Income Differences, Productivity and Input-Output Networks

We study the importance of input-output (IO) linkages and sectoral productivity (TFP) levels in determining cross-country income differences. Using data on IO tables and sectoral TFP levels for 38 countries, we uncover important differences in the interaction of IO structure with sectoral TFP levels across countries: while highly connected sectors are more productive than the typical sector in poor countries, the opposite is true in rich ones. To assess the quantitative role of linkages and sectoral TFP dierences in cross-country income differences, we decompose cross-country variation in real GDP per worker using a multi-sector general equilibrium model. We find that (i) IO linkages substantially amplify fundamental sectoral TFP variation but that (ii) this amplication is signicantly weaker than the one suggested by a simple IO model with an aggregate intermediate good that abstracts from the details of the interaction between sectoral TFPs and countries' IO structure.<br><br>