Industry Origins of the American Productivity Resurgence

Jorgenson, Dale W.; Ho, Mun S.; Samuels, Jon D.; Stiroh, Kevin J.

doi:10.4036/iis.2008.43

Cited by 53 publications

(107 citation statements)

References 14 publications

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“…Let us examine this issue in a growth accounting framework. As Jorgenson et al (2007) have shown, the way in which the resource reallocation effect is measured in growth accounting depends on the type of growth accounting method chosen. In the case of growth accounting in the EU KLEMS project, factor price equalization between industries is not assumed and macro-level factor inputs are calculated by a Tornqvist index, in which factor input growth across industries is aggregated by using the factor income in each industry as aggregation weights.…”

Section: Measurement Methodology and Results For The Market Economy Amentioning

confidence: 99%

“…In this approach, reallocation effects are included in macro TFP growth. Jorgenson et al (2007) showed the following relationship between the macro TFP growth derived from the production possibility frontier approach, ν T , and the macro TFP growth derived from the direct aggregation across industries approach, …”

Section: Measurement Methodology and Results For The Market Economy Amentioning

confidence: 99%

“…However, there is another type of growth accounting method, which Jorgenson et al (2007) called the "production possibility frontier" approach. In this case, each input is assumed to receive the same price in all industries.…”

Section: Measurement Methodology and Results For The Market Economy Amentioning

confidence: 99%

“…Therefore, if production factors move from low factor price industries to high factor price industries, this reallocation will be treated as an increase in macro-level factor inputs. Jorgenson et al (2007) labeled this type of growth accounting method the "direct aggregation across industries" approach.…”

Section: Measurement Methodology and Results For The Market Economy Amentioning

confidence: 99%

See 3 more Smart Citations

Estimates of Total Factor Productivity, the Contribution of ICT, and Resource Reallocation Effects in Japan and Korea

Fukao¹,

Miyagawa²,

Pyo³

et al. 2012

Industrial Productivity in Europe

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The purpose of our study is to identify the sources of economic growth based on a KLEMS model for Japan and Korea. We also identify the growth contribution of ICT assets and resource reallocation effects in the two economies. Both Japan and Korea enjoyed high TFP growth in ICT-producing sectors but suffered low TFP growth in ICT-using sectors. For Japan, we find that the main factor underlying the Lost Decade is the slow-down in TFP growth. We also found that Korea's TFP growth was slow until the Asian financial crisis of 1997-1999 but then accelerated after the crisis. It seems that before the crisis, Korea was following a catch-up process with developed economies that was predominantly input-led and manufacturing-based, as documented by Timmer (1999) and Pyo (2001). However, through the drastic economic reform undertaken during the crisis, Korea seems to have shifted to a new phase of economic growth since the end of the 1990s. TFP growth rates, especially those in manufacturing sectors, have substantially increased in post-crisis Korea. Both in Japan and Korea, productivity in service sectors is much lower than in manufacturing. The reason probably is excessive regulation and a lack of competition in service sectors. And these factors seem to have impeded introduction of ICT in service industries. As for ICT capital accumulation, the ICT investment/GDP ratio of Korea is higher than that of Japan. Especially, the speed of ICT accumulation in the ICT sector in Korea is much faster than that in Japan. Both in Japan and Korea, the largest component in ICT investment is computing equipment.In the case of resource reallocation across sectors, the reallocation effect of capital input was negligible or negative for most periods both in Korea and Japan. After the financial crisis of 1997-99, the resource allocation effect of capital in Korea remained negative, although the size of the negative effect declined. On the other hand, the reallocation effect of labor input was positive for most periods both in Korea and Japan.

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Section: Measurement Methodology and Results For The Market Economy Amentioning

confidence: 99%

Section: Measurement Methodology and Results For The Market Economy Amentioning

confidence: 99%

Section: Measurement Methodology and Results For The Market Economy Amentioning

confidence: 99%

Section: Measurement Methodology and Results For The Market Economy Amentioning

confidence: 99%

See 2 more Smart Citations

Estimates of Total Factor Productivity, the Contribution of ICT, and Resource Reallocation Effects in Japan and Korea

Fukao¹,

Miyagawa²,

Pyo³

et al. 2012

Industrial Productivity in Europe

View full text Add to dashboard Cite

show abstract

“…In 2012, (1-Appendix 1: Relations between industry and aggregate labour productivity 1a. Industry and aggregate labour productivity Following Jorgenson, Ho et al (2007) define labour productivity as value-added per hour where unsubscripted variables are aggregates and subscript j refers to industry…”

Section: Bb V S K mentioning

confidence: 99%

Accounting for the UK Productivity Puzzle: A Decomposition and Predictions

Haskel¹,

Goodridge

Wallis

2016

Economica

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This paper revisits the UK productivity puzzle using a new set of data on outputs and inputs and clarifying the role of output mismeasurement, input growth and industry effects. Our data indicates an implied labour productivity gap of 13 percentage points in 2011 relative to the productivity level on pre-recession trends. We find that: (a) the labour productivity puzzle is a TFP puzzle, since it is not explained by the contributions of labour or capital services (b) the re-allocation of labour between industries deepens rather than explains the productivity puzzle (i.e. there has been actually been a reallocation of hours away from low-productivity industries and toward high productivity industries (c) capitalisation of R&D does not explain the productivity puzzle (d) assuming increased scrapping rates since the recession, a 25% (50%) increase in depreciation rates post-2009 can potentially explain 15%(31%) of the productivity puzzle (e) industry data shows 35% of the TFP puzzle can be explained by weak TFP growth in the oil and gas and financial services sectors and (f) cyclical effects via factor utilisation could potentially explain 17% of the productivity puzzle. Continued weakness in finance would suggest a future lowering of TFP growth to around 0.8% pa from a baseline of 0.9% pa.

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Software availability and entry

Bennett

Hall

2019

Strategic Management Journal

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Research Summary What happens to market structure as an industry's operations lean ever more on software? We find that software availability is associated with an increase in entry and an increase in exit by the oldest and most established firms. We suggest three potential mechanisms and, through post hoc analysis, determine which is most consistent with observed patterns. We find the effect of software availability on entry is stronger in settings with more available IT talent, more permissive labor policies, and greater demand uncertainty. Observed patterns are most consistent with software enhancing labor productivity and thus reducing exposure to uncertainty. Managerial Summary Managers and policymakers are concerned with whether technologies like software and robotics spreading to new industries can make powerful firms even harder to unseat. For software, we find evidence consistent with the opposite: as software becomes more prevalent, entry by new firms increases and the likelihood that older firms exit increases. The patterns of entry we observe are consistent with the following mechanism. Software allows the same number of employees to serve a wider range of production levels, meaning that potential startups are less likely to be deterred by uncertain demand.

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Industry Origins of the American Productivity Resurgence

Cited by 53 publications

References 14 publications

Estimates of Total Factor Productivity, the Contribution of ICT, and Resource Reallocation Effects in Japan and Korea

Estimates of Total Factor Productivity, the Contribution of ICT, and Resource Reallocation Effects in Japan and Korea

Accounting for the UK Productivity Puzzle: A Decomposition and Predictions

Software availability and entry

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