Advanced Search
MyIDEAS: Login to save this article or follow this journal

The Productivity Slowdown Puzzle. Technological and Non-technological Shocks in the Labor Market

Contents:

Author Info

  • Enrico Saltari
  • Giuseppe Travaglini

Abstract

In this paper we address the question of whether labor supply shifts are the only source of the productivity slowdown that occurred across European countries in the last 15 years. This explanation implies that labor demand shifts are irrelevant. Using a simple dynamic model of the labor market, we show that the poor economic performance of the European countries can only be accounted for by a combination of two shocks: an adverse technological shock to the labor demand and a positive non-technological shock to the labor supply resulting from changes in institutions. We use a structural VAR model to estimate the contribution of these two shocks to the dynamics of employment and productivity. Our main conclusion is that technological shocks explain the decrease of the growth rate of productivity but not the increase in employment. The non-technological shocks, on the other hand, can capture the increase of employment but not the slowdown of labor productivity. Thus, both shocks are necessary to provide a complete picture of the employment-productivity trade off in Europe during the last 15 years.

Download Info

If you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
File URL: http://www.tandfonline.com/doi/abs/10.1080/10168730903377819
Download Restriction: Access to full text is restricted to subscribers.

As the access to this document is restricted, you may want to look for a different version under "Related research" (further below) or search for a different version of it.

Bibliographic Info

Article provided by Taylor & Francis Journals in its journal International Economic Journal.

Volume (Year): 23 (2009)
Issue (Month): 4 ()
Pages: 483-509

as in new window
Handle: RePEc:taf:intecj:v:23:y:2009:i:4:p:483-509

Contact details of provider:
Web page: http://www.tandfonline.com/RIEJ20

Order Information:
Web: http://www.tandfonline.com/pricing/journal/RIEJ20

Related research

Keywords: Productivity slowdown; labor market; SVAR;

References

No references listed on IDEAS
You can help add them by filling out this form.

Citations

Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
as in new window

Cited by:
  1. E. et al. Saltari, 2011. "The impact of ICT on the Italian productivity dynamics," Working Papers 149, University of Rome La Sapienza, Department of Public Economics.
  2. Saltari, Enrico & Wymer, Clifford R. & Federici, Daniela, 2013. "The impact of ICT and business services on the Italian economy," Structural Change and Economic Dynamics, Elsevier, vol. 25(C), pages 110-118.
  3. Leonello Tronti, 2010. "The Italian productivity slow-down: the role of the bargaining model," International Journal of Manpower, Emerald Group Publishing, vol. 31(7), pages 770-792, November.
  4. Giuseppe Travaglini, 2010. "The dynamic effects of technological and non technological shocks in the energy sector: a case study for Italy," Working Papers 1001, University of Urbino Carlo Bo, Department of Economics, Society & Politics - Scientific Committee - L. Stefanini & G. Travaglini, revised 2010.
  5. Enrico Saltari, 2012. "The role of ICT and Business Services in Italy," Working Papers 152, University of Rome La Sapienza, Department of Public Economics.

Lists

This item is not listed on Wikipedia, on a reading list or among the top items on IDEAS.

Statistics

Access and download statistics

Corrections

When requesting a correction, please mention this item's handle: RePEc:taf:intecj:v:23:y:2009:i:4:p:483-509. See general information about how to correct material in RePEc.

For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Michael McNulty).

If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

If references are entirely missing, you can add them using this form.

If the full references list an item that is present in RePEc, but the system did not link to it, you can help with this form.

If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your profile, as there may be some citations waiting for confirmation.

Please note that corrections may take a couple of weeks to filter through the various RePEc services.