Why Is Productivity Slowing Down?

Ian Goldin, Pantelis Koutroumpis, François Lafond and Julian Winkler

Journal of Economic Literature, 2024, vol. 62, issue 1, 196-268

Abstract: We examine the contribution of different explanations to the slowdown of labor productivity. Comparing the post-2005 period with the preceding decade for five advanced economies, we seek to explain a slowdown of 0.8 to 1.8 pp. No single explanation accounts for the slowdown, but we have identified a combination of factors that, taken together, account for much of what has been observed. In the countries we have studied, these are mismeasurement, a decline in the contribution of capital per worker, lower spillovers from the growth of intangible capital, the slowdown in trade, and a lower growth of allocative efficiency. Sectoral reallocation and a lower contribution of human capital may also have played a role in some countries. In addition to our quantitative assessment of explanations for the slowdown, we qualitatively assess other explanations, including whether productivity growth may be declining due to innovation slowing down.

JEL-codes: E23 E24 J24 L16 O33 O47 (search for similar items in EconPapers)
Date: 2024
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Citations: View citations in EconPapers (16)

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Related works:
Working Paper: Why is productivity slowing down? (2022)
Working Paper: Why is productivity slowing down? (2021)
Working Paper: Why is productivity slowing down? (2020)
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DOI: 10.1257/jel.20221543

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