Template-type: ReDIF-Article 1.0 Author-Name: Andrew Sharpe Author-Email: andrew.sharpe@csls.ca Title: Editor’s Overview Abstract: This 14th issue of the International Productivity Monitor published by the Centre for the Study of Living Standards contains five articles. Topics covered are recent productivity developments in the United States; lessons for Canada from international productivity experience; India’s productivity performance; measurement error and productivity growth in the Canadian construction industry; and the recently released EU KLEMS productivity and growth accounts. Classification-JEL: C40, E01, F40, F41, O11 Keywords: Productivity in the United States, International experience, India's productivity, Measurement Error, Construction, EU KLEMS, Growth accounts. Journal: International Productivity Monitor Pages: 1-2 Volume: 14 Year: 2007 Month: Spring File-URL: http://www.csls.ca/ipm/14/IPM-14-editoroverview-e.pdf File-Format: Application/pdf File-URL: http://www.csls.ca/ipm/14/IPM-14-editoroverview-f.pdf File-Function: version en français File-Format: Application/pdf Handle: RePEc:sls:ipmsls:v:14:y:2007:0 Template-type: ReDIF-Article 1.0 Author-Name: Barry P. Bosworth Author-Name: Jack E. Triplett Title: The Early 21st Century U.S. Productivity Expansion is Still in Services Abstract: Labour productivity in the U.S. non-farm business sector grew two and a half per cent per year during the 1995-2005 period, nearly double its growth rate over the previous two decades. Services sector labour productivity (LP) and multifactor productivity (MFP) grew more rapidly and substantially exceeded productivity accelerations in the goods sector. We show that the services sector accounted for three-quarters of U.S. MFP growth after 1995, and within services the contribution of MFP to LP growth exceeded the vaunted contribution of IT investment. We also find that the services sector has become even more important as the primary source of sustained productivity growth after 2000. In this study, we compute LP, MFP and contributions to growth accounts for 57 industries within the goods and services sectors, using the new NAICS-based data set. We also show that resource reallocations, which are a newly important factor in productivity analysis, have changed the relation between increases in industry productivity growth rates and aggregate and sector growth rates in surprising ways. Classification-JEL: E01, F00, O11, O25, O31, O40, O47, O51 Keywords: Labour productivity, Multifactor productivity, Service sector, Resource reallocations. Journal: International Productivity Monitor Pages: 3-19 Volume: 14 Year: 2007 Month: Spring File-URL: http://www.csls.ca/ipm/14/IPM-14-bosworth-e.pdf File-Format: Application/pdf File-URL: http://www.csls.ca/ipm/14/IPM-14-bosworth-f.pdf File-Function: version en français File-Format: Application/pdf Handle: RePEc:sls:ipmsls:v:14:y:2007:1 Template-type: ReDIF-Article 1.0 Author-Name: Andrew Sharpe Author-Email: andrew.sharpe@csls.ca Title: Lessons for Canada from International Productivity Experience Abstract: The objective of this paper is to develop a more comprehensive understanding, from a policy perspective, of key drivers of labour productivity in selected OECD countries and their impact on enhanced productivity performance. The paper first presents some general lessons from the productivity performance of OECD countries and international evidence of productivity drivers based on the OECD growth project and productivity studies by the McKinsey Global Institute. It then briefly discusses the productivity experience of six OECD countries considered of particular interest to Canada — the United States, Australia, Ireland, the United Kingdom, Finland, and Sweden — and comments on possible lessons for Canada from these experiences. Classification-JEL: F00, F14, O20, O21, O40, O43, O51, O52, O57 Keywords: Labour Productivity, Productivity drivers, International experience. Journal: International Productivity Monitor Pages: 20-37 Volume: 14 Year: 2007 Month: Spring File-URL: http://www.csls.ca/ipm/14/IPM-14-sharpe-e.pdf File-Format: Application/pdf File-URL: http://www.csls.ca/ipm/14/IPM-14-sharpe-f.pdf File-Function: version en français File-Format: Application/pdf Handle: RePEc:sls:ipmsls:v:14:y:2007:2 Template-type: ReDIF-Article 1.0 Author-Name: Joydeep Mukherji Title: India: Asia’s Next Productivity Success Story Abstract: India has created the basic rules of modern economic and political life. While the country’s institutional framework needs strengthening, it will allow India to prosper without drastic changes. Gradual economic reform has transformed India, putting it on a much faster growth path. Economic growth in the next ten years may not equal China’s current double-digit growth rate, but India is nevertheless very likely to become one of the fastest growing economies in the world, growing at a pace similar to that of Malaysia, Thailand, Taiwan and Korea during their period of sustained rapid economic growth. The recent acceleration in real GDP growth reflects both faster input growth as well as rising total factor productivity. However, India has weaker social pillars to support economic growth than other East Asian countries had at the time of their miracle growth years, mainly due to its poor education system. Failure to address shortcomings in education, along with inadequate physical infrastructure, and large fiscal deficits, would constrain India from reaching even faster growth. Classification-JEL: F00, F01, O21, O21, O23, O40, O53, O57 Keywords: Economic growth, Institutional framework, Input growth, Total factor productivity, Education system, Physical infrastructure, Fiscal deficits. Journal: International Productivity Monitor Pages: 38-52 Volume: 14 Year: 2007 Month: Spring File-URL: http://www.csls.ca/ipm/14/IPM-14-mukherji-e.pdf File-Format: Application/pdf File-URL: http://www.csls.ca/ipm/14/IPM-14-mukherji-f.pdf File-Function: version en français File-Format: Application/pdf Handle: RePEc:sls:ipmsls:v:14:y:2007:3 Template-type: ReDIF-Article 1.0 Author-Name: Peter Harrison Title: Can Measurement Error Explain the Weakness of Productivity Growth in the Canadian Construction Industry? Abstract: According to Statistics Canada productivity estimates, the rate of growth of real output per hour in the construction industry in Canada over the 1981-2006 period was 0.53 per cent per year, one-third of the business sector average. This article examines evidence for and against the hypothesis that measurement error explains this below average productivity performance. The article finds that the use of input cost indexes to adjust nominal output to obtain real output, instead of the more appropriate use of output price indexes, for certain sub-industries of the construction sector represents the most likely source of measurement error. This procedure may result in a downward bias to labour productivity growth in the construction sector of up to 0.44 percentage points per year. It is thus likely that measurement error explains some, but not all, of the gap in labour productivity growth between the construction industry and the business sector. Classification-JEL: C40, C80, C82, L74, O40, O51 Keywords: Real labour productivity, Construction industry, Business sector, Input cost indexes, Measurement error, Productivity gap. Pages: 53-70 Volume: 14 Year: 2007 Month: Spring File-URL: http://www.csls.ca/ipm/14/IPM-14-harrison-e.pdf File-Format: Application/pdf File-URL: http://www.csls.ca/ipm/14/IPM-14-harrison-f.pdf File-Function: version en français File-Format: Application/pdf Handle: RePEc:sls:ipmsls:v:14:y:2007:4 Template-type: ReDIF-Article 1.0 Author-Name: Marcel P. Timmer Author-Name: Mary O’Mahony Author-Name: Bart van Ark Title: EU KLEMS Growth and Productivity Accounts: An Overview Abstract: In March 2007, the EU KLEMS Growth and Productivity Accounts were publicly released. These accounts include measures of output growth, employment and skill creation, capital formation and multifactor productivity (MFP) at the industry level for European Union member states from 1970 onwards. This overview paper first discusses the key characteristics of the database and the variables, country and industry coverage, then reviews the growth accounting methodology, including the measurement of labour and capital services, and finally provides a brief analysis of major trends. The first release of the EU KLEMS database confirms the view that European countries showed a significant slowdown in productivity growth since 1995, which is shown to be widespread across countries and industries, but with notable differences. Classification-JEL: C80, O00, O40, O47, O52. Keywords: EU KLEMS, Growth accounts, Industry level, Growth accounting methodology. Journal: International Productivity Monitor Pages: 71-85 Volume: 14 Year: 2007 Month: Spring File-URL: http://www.csls.ca/ipm/14/IPM-14-timmer-e.pdf File-Format: Application/pdf File-URL: http://www.csls.ca/ipm/14/IPM-14-timmer-f.pdf File-Function: version en français File-Format: Application/pdf Handle: RePEc:sls:ipmsls:v:14:y:2007:5