Five-year average productivity

Productivity 
That is from Paul Krugman.  And from Krugman's source, Bart van Ark:

To conclude, there is good reason to adjust the long-term US productivity growth rate downwards.

Comments

Hmm, ya, that Euro series has a way of drawing your eyes from high to low. Good point. I think I see the USA's problem...

Good point. US looks pretty stable at 1-1.5% since the 70's.

And did a lot better briefly in the late 90's/earlier 00's. If you just did an Arima extrapolation you'd probably guess 1.2% or so going forward. Europe looks more worrisome though.

How about distribution rates and density instead of just Walmart and big box stores as well? Before you say the productivity is big box stores, you should look at the number of store openings, density served, etc over this period.

Walmart was not just between 1997 and 2005. You would also expect to see it in sales/cost ratios in retailing, but I don't think you'll find it there.

Anyway, I'm off to Costco.

I calculate a series of real retail sales per retail hours worked.

It is extremely close to being a measure of retail productivity and this measure shows no signs of slowing. Since 1980 its' average growth has been 2.3%.

The European series seems a bit funny to me. Some back of the envelope calculations I did with OECD data tell me that French and German TFP have grown at the same rate as in the US from 1991-2007 and are at US levels...similar results with labor productivity. How much of this all is due to including countries like Spain and Italy which were still rather poor as of 1970?

So we've given up looking at long run trends, then?

My theoretical work suggests that even if aggregate productivity declines during recessions, the growth rate of frontier productivity is still pretty near constant. (It is just that fewer industries are bothering to catch-up to that frontier.) Paper's here:
http://users.ox.ac.uk/~ball1377/tholden_jmp.pdf

Of course its a pretty stylized model... (And apologies for blowing my own trumpet.)

If you take out the over-activity of the US 98-2007 period it flattens out and makes the running average lower and our chart more nearly tracks their chart.

Future productivity growth has nothing to do with any moving average drawn from merely 40 years of data that purport to measure something that is hard to measure. The future productivity growth rate comes from what people are doing right now. Raise the salaries of engineers and scientists and you'll have more productivity growth. Pay business managers with shares.

Scientific!

Productivity growth was 2.4% in 2009 and 2.8% in 2010. It remains to be seen if this will be sustained.

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