Do Computers Make Output Harder to Measure?
In recent years, U.S. productivity growth accelerated sharply in manufacturing, but has remained sluggish in the most computer-intensive service industries. This paper explores the possibility that information technology is generating output that is increasingly hard to measure in nonmanufacturing industries, which contributes to the divergence in industry productivity growth rates. Our results suggest that measurement error in 13 computer-intensive, nonmanufacturing industries increased between 0.74 and 1.57 percentage points per year in the 1990s, which understates annual aggregate productivity growth by 0.10 to 0.20 percentage points in the 1990s. This adds to an estimated 0.22 to 0.30 percentage point error from the increasing share of aggregate output in these hard-to-measure industries. Thus, increasing measurement problems may understate aggregate productivity growth by an additional 0.32 to 0.50 percentage points per year in the 1990s and play an important role in understanding recent productivity trends at the industry level. Copyright 2001 by Kluwer Academic Publishers
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.
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.
Volume (Year): 26 (2001)
Issue (Month): 4 (October)
|Contact details of provider:|| Web page: http://www.springer.com|
|Order Information:||Web: http://www.springer.com/business+%26+management/journal/10961/PS2|
References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Berndt, Ernst R. & Morrison, Catherine J., 1995.
"High-tech capital formation and economic performance in U.S. manufacturing industries An exploratory analysis,"
Journal of Econometrics,
Elsevier, vol. 65(1), pages 9-43, January.
- Berndt, Ernst R. & Morrison, Catherine J., 1992. "High-tech capital formation and economic performance in U.S. manufacturing industries : an exploratory analysis," Working papers 3419-92., Massachusetts Institute of Technology (MIT), Sloan School of Management.
- Allen N. Berger & Loretta J. Mester, 1999.
"What explains the dramatic changes in cost and profit performance of the U.S. banking industry?,"
99-1, Federal Reserve Bank of Philadelphia.
- Allen N. Berger & Loretta J. Mester, 1999. "What explains the dramatic changes in cost and profit performance of the U.S. banking industry?," Finance and Economics Discussion Series 1999-13, Board of Governors of the Federal Reserve System (U.S.).
- Allen N. Berger & Loretta J. Mester, 1999. "What Explains the Dramatic Changes in Cost and Profit Performance of the U.S. Banking Industry?," Center for Financial Institutions Working Papers 99-10, Wharton School Center for Financial Institutions, University of Pennsylvania.
- Donald Siegel, 1997. "The Impact Of Computers On Manufacturing Productivity Growth: A Multiple-Indicators, Multiple-Causes Approach," The Review of Economics and Statistics, MIT Press, vol. 79(1), pages 68-78, February.
- Charles Steindel, 1992. "Manufacturing productivity and high-tech investment," Quarterly Review, Federal Reserve Bank of New York, issue Sum, pages 39-47.
- Francesco Caselli, 1999. "Technological Revolutions," American Economic Review, American Economic Association, vol. 89(1), pages 78-102, March.
- Lawrence Slifman & Carol Corrado, 1996.
"Decomposition of productivity and unit costs,"
1, Board of Governors of the Federal Reserve System (U.S.).
- James A. Kahn & Jong-Soo Lim, 1998.
"Skilled Labor-Augmenting Technical Progress in U. S. Manufacturing,"
The Quarterly Journal of Economics,
Oxford University Press, vol. 113(4), pages 1281-1308.
- James A. Kahn & Jong-Soo Lim, 1998. "Skilled labor-augmenting technical progress in U.S. manufacturing," Staff Reports 47, Federal Reserve Bank of New York.
- Kahn, J. & Lim, J.S., 1997. "Skilled Labor-Augmenting Technical Progress in U.S. Manufacturing," RCER Working Papers 437, University of Rochester - Center for Economic Research (RCER).
- James A. Kahn & Jong-Soo Lim, 1997. "Skilled labor -- augmenting technical progress in U.S. manufacturing," Research Paper 9738, Federal Reserve Bank of New York.
- Surendra Gera & Wulong Wu & Frank C. Lee, 1999. "Information technology and productivity growth: an empirical analysis for Canada and the United States," Canadian Journal of Economics, Canadian Economics Association, vol. 32(2), pages 384-407, April.
- Jorgenson, D.W. & Stiroh, K., 1994. "Computers abd Growth," Harvard Institute of Economic Research Working Papers 1707, Harvard - Institute of Economic Research.
- Hill, T P, 1977. "On Goods and Services," Review of Income and Wealth, International Association for Research in Income and Wealth, vol. 23(4), pages 315-38, December.
- Erik Brynjolfsson & Lorin Hitt, 1997.
"Information Technology as a Factor of Production: The Role of Differences Among Firms,"
Working Paper Series
201, MIT Center for Coordination Science.
- Brynjolfsson, Erik. & Hitt, Lorin M., 1994. "Information technology as a factor of production : the role of differences among firms," Working papers 3715-94. CCSTR ; #173., Massachusetts Institute of Technology (MIT), Sloan School of Management.
- Dale W. Jorgenson & Kevin J. Stiroh, 2000.
"Raising the Speed Limit: US Economic Growth in the Information Age,"
OECD Economics Department Working Papers
261, OECD Publishing.
- Dale W. Jorgenson & Kevin J. Stiroh, 2000. "Raising the Speed Limit: U.S. Economic Growth in the Information Age," Brookings Papers on Economic Activity, Economic Studies Program, The Brookings Institution, vol. 31(1), pages 125-236.
- Zvi Griliches, 1992. "Output Measurement in the Service Sectors," NBER Books, National Bureau of Economic Research, Inc, number gril92-1, February.
- Joseph H. Haimowitz, 1998. "Has the surge in computer spending fundamentally changed the economy?," Economic Review, Federal Reserve Bank of Kansas City, issue Q II, pages 27-42.
- Daniel E. Sichel, 2000. "The Productivity Slowdown: Is A Growing Unmeasurable Sector The Culprit?," The Review of Economics and Statistics, MIT Press, vol. 79(3), pages 367-370, August.
- Stiroh, Kevin J, 1998. "Computers, Productivity, and Input Substitution," Economic Inquiry, Western Economic Association International, vol. 36(2), pages 175-91, April.
- Frank R. Lichtenberg, 1993. "The Output Contributions of Computer Equipment and Personnel: A Firm- Level Analysis," NBER Working Papers 4540, National Bureau of Economic Research, Inc.
- Martin Neil Baily & Robert J. Gordon, 1988. "The Productivity Slowdown, Measurement Issues, and the Explosion of Computer Power," Brookings Papers on Economic Activity, Economic Studies Program, The Brookings Institution, vol. 19(2), pages 347-432.
When requesting a correction, please mention this item's handle: RePEc:kap:jtecht:v:26:y:2001:i:4:p:295-321. 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: (Sonal Shukla)or (Rebekah McClure)
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.