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The Productivity Slowdown in Canada: an ICT Phenomenon?

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  • Jeff Mollins

  • Pierre St-Amant

Abstract

We ask whether a weaker contribution of information and communication technologies (ICT) to productivity growth could account for the productivity slowdown observed in Canada since the early 2000s. To answer this question, we consider several models which capture channels by which ICT could affect productivity growth. Our results indicate that ICT continues to contribute to productivity growth, but that this contribution has declined and consequently accounts for part of the productivity growth slowdown. However, the productivity slowdown and the change in the contribution of ICT do not seem to have the same timing. While productivity growth slowed in the early 2000s, the ICT contribution does not appear to have fallen until around the Great Recession. This prompts the conclusion that while ICT had little to no role in the initial productivity slowdown, it has been a major determinant of the subdued productivity growth since 2007-2009.

Suggested Citation

  • Jeff Mollins & Pierre St-Amant, 2018. "The Productivity Slowdown in Canada: an ICT Phenomenon?," International Productivity Monitor, Centre for the Study of Living Standards, vol. 35, pages 95-112, Fall.
    • Handle: RePEc:sls:ipmsls:v:35:y:2018:5
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    Cited by:

    1. Alejandra Bellatin & Stephanie Houle, 2021. "Overlooking the online world: Does mismeasurement of the digital economy explain the productivity slowdown?," Staff Analytical Notes 2021-10, Bank of Canada.
    2. Farah Omran & Jeremy Kronick, 2019. "Productivity and the Financial Services Sector – How to Achieve New Heights," C.D. Howe Institute Commentary, C.D. Howe Institute, issue 555, October.
    3. Tang, Jianmin & Wang, Weimin, 2020. "Technological frontier, technical efficiency and the post-2000 productivity slowdown in Canada," Structural Change and Economic Dynamics, Elsevier, vol. 55(C), pages 12-25.

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    More about this item

    Keywords

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    JEL classification:

    • L86 - Industrial Organization - - Industry Studies: Services - - - Information and Internet Services; Computer Software
    • O14 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Industrialization; Manufacturing and Service Industries; Choice of Technology
    • D24 - Microeconomics - - Production and Organizations - - - Production; Cost; Capital; Capital, Total Factor, and Multifactor Productivity; Capacity

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