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Changing technology trends, transition dynamics and growth accounting

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  • Michael R. Pakko

Abstract

The technology growth trends that underlie recent productivity patterns are investigated in a framework that incorporates investment-specific technological progress. Structural-break tests and regime-shifting models reveal the presence of a downward shift in TFP growth in the late 1960s and an upward shift in investment-specific technology growth in the mid-1980s. In both cases, these breaks precede observed changes in labor productivity growth by several years. Simulations of technology growth shocks in a basic neoclassical model show that induced patterns of capital accumulation are consistent with the observed lags between technological advances and changes in productivity growth.

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Bibliographic Info

Paper provided by Federal Reserve Bank of St. Louis in its series Working Papers with number 2000-014.

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Date of creation: 2005
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Publication status: Published in Contributions to Macroeconomics, 2005, 5(1), Article 12
Handle: RePEc:fip:fedlwp:2000-014

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Keywords: Technology ; Productivity;

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References

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  11. repec:fth:simfra:95-08 is not listed on IDEAS
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Citations

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Cited by:
  1. Peter Ireland & Scott Schuh, 2008. "Productivity and U.S. Macroeconomic Performance: Interpreting the Past and Predicting the Future with a Two-Sector Real Business Cycle Model," Review of Economic Dynamics, Elsevier for the Society for Economic Dynamics, vol. 11(3), pages 473-492, July.
  2. Zanetti, Francesco, 2008. "Labor and investment frictions in a real business cycle model," Journal of Economic Dynamics and Control, Elsevier, vol. 32(10), pages 3294-3314, October.
  3. Martínez, Diego & Rodríguez, Jesús & Torres, José L., 2008. "The productivity paradox and the new economy: The Spanish case," Journal of Macroeconomics, Elsevier, vol. 30(4), pages 1569-1586, December.
  4. Martínez, Diego & Rodríguez, Jesús & Torres, José L., 2010. "ICT-specific technological change and productivity growth in the US: 1980-2004," Information Economics and Policy, Elsevier, vol. 22(2), pages 121-129, May.
  5. Manuel A. Hidalgo Pérez & Jesús Rodríguez López & José Mª O.Kean Alonso, 2008. "Labor demand and information technologies: evidence for Spain, 1980-2005," Economic Working Papers at Centro de Estudios Andaluces E2008/13, Centro de Estudios Andaluces.
  6. Peter N. Ireland, 2009. "On the Welfare Cost of Inflation and the Recent Behavior of Money Demand," American Economic Review, American Economic Association, vol. 99(3), pages 1040-52, June.
  7. Jesús Rodríguez López & José Luis Torres Chacón, 2009. "Technological sources of productivity growth in Japan, the U.S. and Germany," Working Papers 09.09, Universidad Pablo de Olavide, Department of Economics, revised Mar 2010.
  8. Richard Dion & Robert Fay, 2008. "Understanding Productivity: A Review of Recent Technical Research," Discussion Papers 08-3, Bank of Canada.
  9. Benjamin D. Keen & Michael R. Pakko, 2007. "Monetary policy and natural disasters in a DSGE model: how should the Fed have responded to Hurricane Katrina?," Working Papers 2007-025, Federal Reserve Bank of St. Louis.

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