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OECD Productivity Growth in the 2000s: A Descriptive Analysis of the Impact of Sectoral Effects and Innovation

Listed author(s):
  • Julien Dupont
  • Dominique Guellec
  • Joaquim Oliveira Martins

This paper brings together the latest data and OECD productivity indicators in different areas with the aim of reviewing the main productivity trends over the past decade, comparing the United States, Europe and to some extent Japan. Concerning economy wide indicators of productivity, the slowdown appears to be due to a significant slowdown in investment in information and communication technologies (ICT) followed by a decrease in multi-factor productivity (MFP). However, a new set of indicators of MFP growth by industry shows that the decline of productivity is particularly marked in sectors such as construction and market services. Looking for possible explanations of the decline, a marked slowdown in innovation emerged as the most likely cause. It concludes that, if no new wave of innovation materialises, comparable in size to the one of the late 1990s (around notably the Internet), the OECD trend productivity growth is not likely to resume at its end-1990s level. Only a recovery in innovation itself could trigger a sustainable recovery in productivity in the major OECD countries.

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Article provided by OECD Publishing in its journal OECD Journal: Economic Studies.

Volume (Year): 2011 (2011)
Issue (Month): 1 ()
Pages: 1-23

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Handle: RePEc:oec:ecokac:5kgf3281fmtc
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