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Productivity to the Rescue: Review Article on the McKinsey Global Institute Report Global Growth: Can Productivity Save the Day in an Aging World?

Author

Listed:
  • Andrew Sharpe

Abstract

This review article provides a synthesis and critical assessment of the McKinsey Global Institute (MGI) report Global Growth: Can Productivity Save the Day in an Aging World? The key stylized fact that motivates the report is the expected fall-off in GDP growth for the G- 19 and Nigeria from an average annual rate of 3.6 per cent in the 1964-2014 period to a projected 2.1 per cent in the next fifty years (2014-2064). All of this slowdown is due to a fall-off in employment growth and none to slower labour productivity growth. MGI believes that there is great potential to accelerate productivity growth to offset the fall in employment growth and prevent any fall-off in GDP growth. Indeed, the report makes the case that it is feasible, although extremely challenging, to boost productivity growth in the G-19 and Nigeria to 4 per cent a year over the next decade, largely through catch-up to best practices. The report outlines public policies and private sector actions to achieve this target.

Suggested Citation

  • Andrew Sharpe, 2016. "Productivity to the Rescue: Review Article on the McKinsey Global Institute Report Global Growth: Can Productivity Save the Day in an Aging World?," International Productivity Monitor, Centre for the Study of Living Standards, vol. 30, pages 98-110, Spring.
    • Handle: RePEc:sls:ipmsls:v:30:y:2016:6
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    File URL: http://www.csls.ca/ipm/30/sharpe.pdf
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    References listed on IDEAS

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    1. Robert J. Gordon, 2016. "The Rise and Fall of American Growth: The U.S. Standard of Living since the Civil War," Economics Books, Princeton University Press, edition 1, number 10544.
    2. Don Drummond & Evan Capeluck, 2015. "The Role of Productivity in Long-Term Economic and Fiscal Projections for the Canadian Provinces and Territories, 2014-2038," International Productivity Monitor, Centre for the Study of Living Standards, vol. 29, pages 3-17, Fall.
    3. Lewis, William W., 2004. "The Power of Productivity," University of Chicago Press Economics Books, University of Chicago Press, number 9780226476766.
    4. Don Drummond & Evan Capeluck, 2015. "Long-term Fiscal and Economic Projections for Canada and the Provinces and Territories, 2014-2038," CSLS Research Reports 2015-08, Centre for the Study of Living Standards.
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    More about this item

    Keywords

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    JEL classification:

    • D24 - Microeconomics - - Production and Organizations - - - Production; Cost; Capital; Capital, Total Factor, and Multifactor Productivity; Capacity
    • E24 - Macroeconomics and Monetary Economics - - Consumption, Saving, Production, Employment, and Investment - - - Employment; Unemployment; Wages; Intergenerational Income Distribution; Aggregate Human Capital; Aggregate Labor Productivity
    • J24 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Human Capital; Skills; Occupational Choice; Labor Productivity

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