ECONOMIC DEVELOPMENT MODEL USING PRODUCTIVITY AND TECHNICAL CHANGES: MODIFIED GENERAL INDEX (MGI), GENERALIZED MODIFIED GENERAL INDEX (GMGI) AND GENERAL TIME TREND INDEX (GTTI)

The important issue here is how the production based on modern technology can be expanded. This depends on factors which influence the modern production process. In this paper, we present new indices for estimating technical change, return to scale, and TFP growth. These indices, Modified General Index (MGI), Generalized Modified General Index (GMGI) and General Time Trend index (GTTI), are a generalization of the General Index. The results of the study suggest that for the estimation of technical change, return to scale, and TFP growth, the MGI method is appropriate when we have time series data or panel data with limited cross section data. When there is a need to compare irregular periods of time (for evaluation plan or policies), we suggest the GMGI method and when we have time series data or panel data with limited cross section data, and a trend in every period, we propose the GTTI method. Besides These methods, The most important factor involved in the development program success is to adjust the program projects with natural, social and economic conditions of that region.