We investigate the effects of color-octet contributions to the radiative Y
decay within the Bodwin, Braaten, and Lepage nonrelativistic QCD (NRQCD) fr
amework. We compute the short-distance coefficients at next-to-leading orde
r (NLO) in a(s) for the most relevant color-octet intermediate states and c
onsider photons coming both from the coupling to hard processes ("direct")
and by collinear emission from light quarks ("fragmentation"). An estimate
for the nonperturbative matrix elements which enter in the final result is
then obtained. By comparing the NRQCD prediction at NLO for total decay rat
es with the experimental data, it is found that the nonperturbative paramet
ers must be smaller than expected from the naive scaling rules of NRQCD. Ne
vertheless, color-octet contributions to the shape of the photon spectrum t
urn out to be significant. [S0556-2821(99)02705-8].