The Productivity J-Curve from an International Perspective: Is the United States Unique?

Ahmed Bounfour, Kazuma Edamura, Takayuki Ishikawa, Tsutomu Miyagawa, Alberto Nonnis and Konomi Tonogi

International Productivity Monitor, 2026, vol. 50, 27-47

Abstract: Despite major advances in technology, productivity growth has slowed across advanced economies. Brynjolfsson, Rock and Syverson (2021) argued that, due to the large intangible investments associated with digitalization, total factor productivity (TFP) growth may be underestimated and be higher after the investment boom. The resulting gap between standard and revised measures produces a J-shaped pattern, the “productivity J-curve”. Building on this work, we examine productivity estimates for five advanced economies: France, Germany, Japan, the United Kingdom and the United States. Using the estimated coefficients on intangibles (research and development, software, and organizational capital) in the value functions of listed firms over 2006-2020, we find that TFP underestimation caused by large intangible investments was largely unique to the United States, and was much smaller in Europe and Japan. This result is consistent with the recent productivity rebound in the U.S. and reinforces the call for investment in innovation in Europe and Japan.

Date: 2026
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