--- canonical_url: "https://csls.ca/ipm-archive/issue-1/labour-or-total-factor-productivity-do-we-need-to-choose/" title: "Labour or Total Factor Productivity: Do We Need to Choose?" author: name: "CSLS" url: "https://csls.ca/author/cslc/" date_published: "2026-07-10T09:12:45+00:00" date_modified: "2026-07-13T06:38:06+00:00" post_type: "ipm" summary: "" ipm_issue_period: - "Fall 2000" ipm_keyword: - "Canada" - "capital-embodied technical change" - "endogenous growth" - "labour productivity" - "measurement" - "neoclassical growth model" - "TFP" ipm_research_theme: - "Measurement and methodology" ipm_country_focus: - "Canada" featured_image: "https://csls.ca/wp-content/uploads/2026/06/IPM_50_banner.webp" status: "publish" --- # Labour or Total Factor Productivity: Do We Need to Choose? Canonical URL: https://csls.ca/ipm-archive/issue-1/labour-or-total-factor-productivity-do-we-need-to-choose/ # Labour or Total Factor Productivity: Do We Need to Choose? [Download full PDF article](https://csls.ca/wp-content/uploads/2026/07/IPM-Issue-1-7-Sargent-Rodriguez.pdf) Cite this article × Cite this article as: Sargent, Tim, and Edgard Rodriguez. 2000. “Labour or Total Factor Productivity: Do We Need to Choose?” International Productivity Monitor, No. 1 (Fall 2000): 41–44. https://www.csls.ca/ipm-archive/issue-1/labour-or-total-factor-productivity-do-we-need-to-choose/ ## Authors: - Tim Sargent Centre for the Study of Living Standards (CSLS); Macdonald-Laurier Institute - Edgard Rodriguez Economic Studies and Policy Analysis Division, Department of Finance, Canada ## IPM Issue 1 Fall 2000 pp. 41–44 ## Related IPM articles [Is the SNA Still Useful? 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In the standard neoclassical model, TFP is the preferred guide to long-run trends because capital accumulation is endogenous to TFP growth, while labour productivity is better for short-run (under a decade) analysis. The choice also depends on capital stock data quality — poor capital estimates favour labour productivity — and on the assumed growth model: in models where capital accumulation drives TFP, labour productivity may be equally informative about long-run trends. Cet article soutient que la productivité du travail et la productivité multifactorielle (PMF) ont toutes deux leur utilité et qu’aucune ne devrait être utilisée exclusivement. Dans le modèle néoclassique standard, la PMF est le guide privilégié pour les tendances à long terme parce que l’accumulation de capital est endogène à la croissance de la PMF, tandis que la productivité du travail est préférable pour l’analyse à court terme (moins d’une décennie). Le choix dépend aussi de la qualité des données sur le stock de capital — la médiocrité des estimations de capital favorise la productivité du travail — et du modèle de croissance retenu : dans les modèles où l’accumulation de capital stimule la PMF, la productivité du travail peut être tout aussi informative sur les tendances à long terme. [Download full PDF](https://csls.ca/wp-content/uploads/2026/07/IPM-Issue-1-7-Sargent-Rodriguez.pdf)