Understanding Digital Technology's Evolution and the Path of Measured Productivity Growth: Present and Future in the Mirror of the Past
AbstractThree styles of explanation have been advanced by economists seeking to account for the so-called "productivity paradox". The coincidence of a persisting slowdown in the growth of measured total factor productivity (TFP) in the US, since the mid-1970's with the wave of information technology (It) innovations, is said by some to be an illusion due to the mismeasurement of real output growth; by others to expose the mistaken expectations about the benefits of computerization; and by still others to reflect the amount of time, and the volume of intangible investments in "learning", and the time required for ancillary innovations that allow the new digital technologies to be applied in ways that are reflected in measured productivity growth. This paper shows that rather than viewing these as competing hypotheses, the dynamics of the transition to a new technological and economic regime based upon a general purpose technology (GPT) should be understood to be likely to give rise to all three "effects."
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Bibliographic InfoPaper provided by United Nations World Employment Programme- in its series Papers with number 99-011.
Length: 27 pages
Date of creation: 2000
Date of revision:
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Postal: International Center for Economic Growth, 243 Kearny Street, San Francisco, California 94108.
INFORMATION TECHNOLOGY ; ECONOMIC GROWTH;
Other versions of this item:
- Paul A. David, 2005. "Understanding Digital Technology’s Evolution and the Path of Measured Productivity Growth: Present and Future in the Mirror of the Past," Macroeconomics 0502022, EconWPA.
- L86 - Industrial Organization - - Industry Studies: Services - - - Information and Internet Services; Computer Software
- O40 - Economic Development, Technological Change, and Growth - - Economic Growth and Aggregate Productivity - - - General
- O47 - Economic Development, Technological Change, and Growth - - Economic Growth and Aggregate Productivity - - - Measurement of Economic Growth; Aggregate Productivity; Cross-Country Output Convergence
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