Economics at your fingertips  

Labor productivity growth: disentangling technology and capital accumulation

Michele Battisti (), Massimo Del Gatto and Christopher Parmeter

Journal of Economic Growth, 2018, vol. 23, issue 1, 111-143

Abstract: Abstract How much of the convergence in labor productivity that we observe in manufacturing is due to convergence in technology versus convergence in capital-labor ratios? To shed light on this question, we introduce a nonparametric counterfactual decomposition of labor productivity growth into growth of the capital-labor ratio (K/L), technological productivity (TEP) and total factor productivity (TFP). Our nonparametric specification enables us to model technology allowing for heterogeneity across all relevant dimensions (i.e. countries, sectors and time). Using data spanning from the 1960s to the 2000s, covering 42 OECD and non OECD countries across 11 manufacturing sectors, we find TEP and TFP to account for roughly 46 and −6% of labor productivity growth respectively, on average. While technological growth at the world level is driven primarily by the US and a handful of other OECD countries, we find strong evidence of convergence in both technology and capital-labor ratios. Interestingly, very few of the usual growth determinants are found to enhance the process of technological catching-up.

Keywords: TFP; Aggregate productivity; Technology; Nonparametric estimation; Convergence (search for similar items in EconPapers)
JEL-codes: C14 D24 O41 O47 (search for similar items in EconPapers)
Date: 2018
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (5) Track citations by RSS feed

Downloads: (external link) Abstract (text/html)
Access to full text is restricted to subscribers.

Related works:
Working Paper: Labor Productivity Growth: Disentangling Technology and Capital Accumulation (2014) Downloads
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link:

Ordering information: This journal article can be ordered from
http://www.springer. ... th/journal/10887/PS2

Access Statistics for this article

Journal of Economic Growth is currently edited by Oded Galor

More articles in Journal of Economic Growth from Springer
Bibliographic data for series maintained by Sonal Shukla ().

Page updated 2019-09-27
Handle: RePEc:kap:jecgro:v:23:y:2018:i:1:d:10.1007_s10887-017-9143-1