Journal Article

Has the productivity trend steepened in the 1990s?

Abstract: In the 1990s, conventional measures of productivity growth, or the growth in output per worker, have indicated a dramatic rise. If these measures are correct, the economic benefits are clear. In the short run, sustained, faster productivity growth would enable the economy to expand more rapidly without intensifying inflationary pressures. In the long run, sustained, faster productivity growth would boost real incomes and improve the standard of living.> Despite signs that productivity has recently begun to follow a steeper path, some analysts are skeptical. Episodes of faster productivity growth in the past have often reflected cyclical influences rather than fundamental trend shifts. And, the conventional productivity measure, which is based on fixed-weighted productivity data, has recently shown an upward bias.> To address these concerns, Filardo reexamines the conventional, fixed-weighted productivity measure and also uses a new chain- weighted measure to assess productivity growth. He concludes that the productivity trend has not steepened in the 1990s.

Keywords: Productivity;

Bibliographic Information

Provider: Federal Reserve Bank of Kansas City

Part of Series: Economic Review

Publication Date: 1995

Volume: 80

Issue: Q IV

Pages: 41-59