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Knowledge-Based Labor Productivity Improvements: Canada Case Study, 1961-2004

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Author Info
KHAZABI, Massoud
FALLAHI, F.
Abstract

This paper examines the importance of Research and Development activities as a source of growth in labor productivity in the Canadian economy within last four decades. Time series data are used to develop an econometrics model that captures the interaction between labor productivity and R&D, stock of public infrastructure and trade openness. Extensive tests of quality of data, choice of model and structural breaks are performed to enrich the value of the research. Our results suggest that the type of capital involved has a significant effect on the extent of labor productivity and growth improvement. Innovation as the major characterizer of the knowledge based economy improves the labor productivity both in short and long run. The trade openness effect has been discussed in depth consequently.

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Article provided by Euro-American Association of Economic Development in its journal Applied Econometrics and International Development.

Volume (Year): 8 (2008)
Issue (Month): 1 ()
Pages: 98-106
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Handle: RePEc:eaa:aeinde:v:8:y:2008:i:1_8

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Related research
Keywords: Labour Productivity; Human Capital; Canada;

Find related papers by JEL classification:
C5 - Mathematical and Quantitative Methods - - Econometric Modeling
J1 - Labor and Demographic Economics - - Demographic Economics
O51 - Economic Development, Technological Change, and Growth - - Economywide Country Studies - - - U.S.; Canada

References listed on IDEAS
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  1. Canzoneri, Matthew B & Cumby, Robert & Diba, Behzad, 1996. "Relative Labour Productivity and the Real Exchange Rate in the Long Run: Evidence for a Panel of OECD Countries," CEPR Discussion Papers 1464, C.E.P.R. Discussion Papers. [Downloadable!] (restricted)
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  2. Aschauer, David Alan, 1989. "Is public expenditure productive?," Journal of Monetary Economics, Elsevier, vol. 23(2), pages 177-200, March. [Downloadable!] (restricted)
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  3. Harchaoui, Tarek & Tarkhani, Faouzi, 2005. "Four Decades of Productivity Performance in Canada," The Canadian Productivity Review 2005001e, Statistics Canada, Economic Analysis Division. [Downloadable!]
  4. Blomstrom, Magnus & Lipsey, Robert E & Zejan, Mario, 1996. "Is Fixed Investment the Key to Economic Growth," The Quarterly Journal of Economics, MIT Press, vol. 111(1), pages 269-76, February. [Downloadable!] (restricted)
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  5. Fortune, J Neill, 1987. "Some Determinants of Labour Productivity," Applied Economics, Taylor and Francis Journals, vol. 19(6), pages 839-43, June.
  6. Batstone, Eric, 1986. "Labour and Productivity," Oxford Review of Economic Policy, Oxford University Press, vol. 2(3), pages 32-43, Autumn.
  7. De Long, J Bradford & Summers, Lawrence H, 1991. "Equipment Investment and Economic Growth," The Quarterly Journal of Economics, MIT Press, vol. 106(2), pages 445-502, May. [Downloadable!] (restricted)
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