Found 17 article(s) for author 'Productivity'

Productivity and Pay: is the link broken?

Productivity and Pay: is the link broken? Lawrence Summers, November 2017, Paper, “After growing in tandem for nearly 30 years after the second world war, since 1973 an increasing gap has opened between the compensation of the average American worker and her/his average labor productivity. Brynjolffson and McAfee (2014) use the phrase “the great decoupling” to describe this phenomenon; Bivens and Mishel (2015) refer to it as a “historic divergence”. In recent years discussion has centered on understanding why this phenomenon has occurred and how policy should respond.Link

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The Productivity Slowdown and the Declining Labor Share: A Neoclassical Exploration

The Productivity Slowdown and the Declining Labor Share: A Neoclassical Exploration. Elhanan Helpman, October 2017, Paper, “We explore the possibility that a global productivity slowdown is responsible for the widespread decline in the labor share of national income. In a neoclassical growth model with endogenous human capital accumulation a la Ben Porath (1967) and capital-skill complementarity a la Grossman et al. (2017), the steady-state labor share is positively correlated with the rates of capital-augmenting and labor-augmenting technological progress. We calibrate the key parameters describing the balanced growth path to U.S. data for the early post-war period and find that a one percentage point slowdown in the growth rate of per capita income can account for between one half and all of the observed decline in the US labor share.Link

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The Productivity Slowdown and the Declining Labor Share: A Neoclassical Exploration

The Productivity Slowdown and the Declining Labor Share: A Neoclassical Exploration. Elhanan Helpman, September 2017, Paper, “We explore the possibility that a global productivity slowdown is responsible for the widespread decline in the labor share of national income. In a neoclassical growth model with endogenous human capital accumulation a la Ben Porath (1967) and capital-skill complementarity a la Grossman et al. (2017), the steady-state labor share is positively correlated with the rates of capital-augmenting and labor-augmenting technological progress. We calibrate the key parameters describing the balanced growth path to U.S. data for the early postwar period and find that a one percentage point slowdown in the growth rate of per capita income can account for between one half and all of the observed decline in the U.S. labor share.Link

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Production and Welfare: Progress in Economic Measurement

Production and Welfare: Progress in Economic Measurement. Dale Jorgenson, 2017, Paper, “While the GDP was intended by its originators as a measure of production, the absence of a measure of welfare in the national accounts has led to widespread misuse of the GDP to proxy welfare. Measures of welfare are needed to appraise the outcomes of changes in economic policies and evaluate the results. Concepts that describe the income distribution, such as poverty and inequality, fall within the scope of welfare rather than production. This paper reviews recent advances in the measurement of production and welfare within the national accounts, primarily in the United States and the international organizations. Expanding the framework beyond the national accounts has led to important innovations in the measurement of both production and welfare.Link

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The World Klems Initiative: Measuring Productivity at the Industry Level

The World Klems Initiative: Measuring Productivity at the Industry Level. Dale Jorgenson, February 2017, Paper, “The World KLEMS Initiative was established at the First World KLEMS Conference at Harvard University in August. The purpose of this Initiative is to generate industry-level data on outputs, inputs, and productivity. Productivity is defined as output per unit of all inputs. The inputs consist of capital (K) and labor (L), the primary factors of production, and intermediate inputs of energy (E), materials (M), and services (S). The acronym KLEMS describes these inputs.  Industry-level data have been proved to be indispensable for analyzing the sources of economic growth for countries around the world.Link

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Productivity and Selection of Human Capital with Machine Learning

Productivity and Selection of Human Capital with Machine Learning. Michael Luca, Sendhil Mullainathan, 2016, Paper. “Economists have become increasingly interested in studying the nature of production functions in social policy applications, Y = f(L, K), with the goal of improving productivity. For example what is the effect on student learning from hiring an additional teacher, ∂Y/∂L, in theory (Lazear, 2001) or in practice (Krueger, 2003)? What is the effect of hiring one more police officer (Levitt, 1997)?Link

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The Impact of Information Technology on Postwar US Economic Growth

The Impact of Information Technology on Postwar US Economic Growth. Dale Jorgenson, November 28, 2015, Paper. “We provide detailed information on the crucial role of information technology in the postwar growth of the U.S. economy, from the development of the telecommunications services and the telecommunications equipment industries through the successful commercialization of semiconductor technology and the ongoing shift to cloud-based IT services. Our industry-level data set reveals that productivity gains over the postwar period originated disproportionally in industries that produce IT, but the replication of established technologies through growth of capital and labor inputs explains by far the largest proportion of U.S. economic growth. We find that the substantial growth deceleration during the Great Recession was driven by modestly negative aggregate productivity growth, but that only a minor portion of the drop in the growth rate was due to the IT-producing industries.Link

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Capital Allocation and Productivity in South Europe

Capital Allocation and Productivity in South Europe. Gita Gopinath, July 2015, Paper, “Following the introduction of the euro in 1999, countries in the South experienced large capital inflows and low productivity. We use data for manufacturing firms in Spain to document a significant increase in the dispersion of the return to capital across firms, a stable dispersion of the return to labor across firms, and a significant increase in productivity losses from misallocation over time. We develop a model of heterogenous firms facing financial frictions and investment adjustment costs. The model is consistent with cross-sectional and time-series patterns in size, productivity, capital returns, investment, and debt observed in production and balance sheet data.Link

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Heterogeneous Firms and Trade

Heterogeneous Firms and Trade. Marc Melitz, 2015, Paper. “This chapter reviews the new approach to international trade based on firm heterogeneity in differentiated product markets. This approach explains a variety of features exhibited in disaggregated trade data, including the higher productivity of exporters relative to non-exporters, within-industry reallocations of resources following trade liberalization, and patterns of trade participation across firms and destination markets. Accounting for these empirical patterns reveals new mechanisms through which the aggregate…”  Link verified September 24, 2014

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It’s Where You Work: Increases in Earnings Dispersion across Establishments and Individuals in the U.S.

It’s Where You Work: Increases in Earnings Dispersion across Establishments and Individuals in the U.S. Richard Freeman, August 2014, Paper. “This paper links data on establishments and individuals to analyze the role of establishments in the increase in inequality that has become a central topic in economic analysis and policy debate. It decomposes changes in the variance of log earnings among individuals into the part due to changes in earnings among establishments and the part due to changes in earnings within-establishments and finds that much of the 1970s-2010s increase in earnings inequality results from increased dispersion of the earnings among the establishments where individuals work. It also shows that the divergence of establishment earnings occurred within and across industries and was associated with increased variance of revenues per worker. Our results direct attention to the fundamental role of establishment-level pay setting and economic adjustments in earnings inequality.Link

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