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Potential Growth of the U.S. Economy: Will the Productivity Resurgence Continue?

Author

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  • Dale W Jorgenson

    (Department of Economics, Harvard University, Cambridge, MA, 02138, USA.)

  • Mun S Ho

    (Department of Economics, Harvard University, Cambridge, MA, 02138, USA.)

  • Kevin J Stiroh

    (Research Department, Federal Reserve Bank of New York, New York, NY, 10045, USA.)

Abstract

This paper analyzes the sources of U.S. productivity growth through 2004 and presents medium-term projections for the U.S. economy. We attribute a substantial portion of productivity gains over the past decade to production and use of information technology equipment and software. In the most recent years, we also identify a growing contribution from sources outside the technology-producing sectors. Our base-case projection for the GDP growth rate is almost exactly three percent. We emphasize the substantial range of uncertainty by presenting an optimistic projection of 3.5 percent and a pessimistic projection of only 1.9 percent.Business Economics (2006) 41, 7–16; doi:10.2145/20060101

Suggested Citation

  • Dale W Jorgenson & Mun S Ho & Kevin J Stiroh, 2006. "Potential Growth of the U.S. Economy: Will the Productivity Resurgence Continue?," Business Economics, Palgrave Macmillan;National Association for Business Economics, vol. 41(1), pages 7-16, January.
    • Handle: RePEc:pal:buseco:v:41:y:2006:i:1:p:7-16
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    Citations

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    Cited by:

    1. Dale W. Jorgenson & Mun S. Ho & Kevin J. Stiroh, 2008. "A Retrospective Look at the U.S. Productivity Growth Resurgence," Journal of Economic Perspectives, American Economic Association, vol. 22(1), pages 3-24, Winter.
    2. Georges Daw, 2022. "Determinants of Wealth Disparities in the EU: A Multi-scale Development Accounting Investigation," Comparative Economic Studies, Palgrave Macmillan;Association for Comparative Economic Studies, vol. 64(2), pages 211-254, June.
    3. Dostie Benoit & Jayaraman Rajshri, 2012. "Organizational Redesign, Information Technologies and Workplace Productivity," The B.E. Journal of Economic Analysis & Policy, De Gruyter, vol. 12(1), pages 1-41, February.
    4. Antonin Bergeaud & Gilbert Cette & Rémy Lecat, 2016. "Productivity Trends in Advanced Countries between 1890 and 2012," Review of Income and Wealth, International Association for Research in Income and Wealth, vol. 62(3), pages 420-444, September.
    5. Gilbert Cette & Aurélien Devillard & Vincenzo Spiezia, 2022. "Growth Factors in Developed Countries: A 1960–2019 Growth Accounting Decomposition," Comparative Economic Studies, Palgrave Macmillan;Association for Comparative Economic Studies, vol. 64(2), pages 159-185, June.
    6. Marianna Epicoco, 2021. "Technological Revolutions and Economic Development : Endogenous and Exogenous Fluctuations," Post-Print hal-03588838, HAL.
    7. Bergeaud, A. & Cette, G. & Lecat, R., 2015. "Productivity trends from 1890 to 2012 in advanced countries," Rue de la Banque, Banque de France, issue 07, June..
    8. Georges Daw, 2024. "Impact of technical change via intermediate consumption: exhaustive general equilibrium growth accounting and reassessment applied to USA 1954–1990," Portuguese Economic Journal, Springer;Instituto Superior de Economia e Gestao, vol. 23(1), pages 55-87, January.
    9. Victor Ajai & Karim Anaya & Geoffroy Dolphin & Michael Pollitt, 2022. "Do climate policies explain the productivity puzzle? Evidence from the Energy Sector," Working Papers 016, The Productivity Institute.

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