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Sources of transport sector labor productivity performance in industrialized countries: Insights from a decomposition analysis

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  • Vu, Khuong
  • Hartley, Kris

Abstract

This study examines patterns and sources of growth in the transport sector's labor productivity across 13 industrialized countries over the period 2000–2015. Through decomposition analysis – specifically, the growth accounting method and industry origin analysis – the study makes three principal findings. First, total factor productivity growth plays a crucial but often underleveraged role in driving the sector's growth and catch-up on labor productivity. Second, digital transformation – especially investment in software and database assets – is a significant source of the sector's labor productivity growth and catch-up, while innovation-related capital has a complementary effect. Third, subsector-level labor productivity improvement is the major driver of the sector's overall labor productivity growth, while the growth contribution of labor reallocation among subsectors is insignificant. The article concludes with a discussion of policy insights and implications.

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  • Vu, Khuong & Hartley, Kris, 2022. "Sources of transport sector labor productivity performance in industrialized countries: Insights from a decomposition analysis," Transport Policy, Elsevier, vol. 129(C), pages 204-218.
    • Handle: RePEc:eee:trapol:v:129:y:2022:i:c:p:204-218
    DOI: 10.1016/j.tranpol.2022.10.017
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