IDEAS home Printed from https://ideas.repec.org/a/tsy/journl/journl_tsy_er_2005_2_2.html
   My bibliography  Save this article

Comparing Australian and United States productivity

Author

Listed:
  • Jyoti Rahman

    (Treasury, Government of Australia)

Abstract

Despite a series of broad and deep macroeconomic and microeconomic reforms boosting Australia's productivity growth, the level of Australia’s GDP per capita remains well below that of the United States. A continuing gap in the levels of productivity plays a central role in explaining Australia’s GDP per capita relative to the US. This paper reviews various explanations for the Australia-US productivity gap and finds that the productivity gap can at least in part be explained by a combination of: differences in human capital as represented by educational attainment; differences in product and labour market policies; and the geographic and historical context in which the Australian economy operates. Differences in physical capital per worker and industry structures do not appear to be primary explanations for the productivity gap.

Suggested Citation

  • Jyoti Rahman, 2005. "Comparing Australian and United States productivity," Economic Roundup, The Treasury, Australian Government, issue 2, pages 27-45, June.
    • Handle: RePEc:tsy:journl:journl_tsy_er_2005_2_2
    as

    Download full text from publisher

    File URL: http://archive.treasury.gov.au/documents/987/PDF/04_comparing_productivity.pdf
    Download Restriction: no

    References listed on IDEAS

    as
    1. Paul Conway & Véronique Janod & Giuseppe Nicoletti, 2005. "Product Market Regulation in OECD Countries: 1998 to 2003," OECD Economics Department Working Papers 419, OECD Publishing.
    2. Andrea Bassanini & Stefano Scarpetta, 2001. "Does Human Capital Matter for Growth in OECD Countries?: Evidence from Pooled Mean-Group Estimates," OECD Economics Department Working Papers 282, OECD Publishing.
    3. Ian W. McLean & Alan M. Taylor, 2001. "Australian growth: a California perspective," Pacific Basin Working Paper Series 2001-06, Federal Reserve Bank of San Francisco.
    4. Alan Winters, L. & Martins, Pedro M. G., 2004. "When comparative advantage is not enough: business costs in small remote economies," World Trade Review, Cambridge University Press, vol. 3(03), pages 347-383, November.
    5. Chad Syverson, 2004. "Market Structure and Productivity: A Concrete Example," Journal of Political Economy, University of Chicago Press, vol. 112(6), pages 1181-1222, December.
    6. N. Gregory Mankiw & David Romer & David N. Weil, 1992. "A Contribution to the Empirics of Economic Growth," The Quarterly Journal of Economics, Oxford University Press, vol. 107(2), pages 407-437.
    7. C.J. Krizan & John Haltiwanger & Lucia Foster, 2002. "The Link Between Aggregate and Micro Productivity Growth: Evidence from Retail Trade," Working Papers 02-18, Center for Economic Studies, U.S. Census Bureau.
    8. Robert J. Gordon, 2004. "Why was Europe Left at the Station When America's Productivity Locomotive Departed?," NBER Working Papers 10661, National Bureau of Economic Research, Inc.
    9. Lewis Evans and Patrick Hughes, 2003. "Competition Policy in Small Distant Open Economies: Some Lessons from the Economics Literature," Treasury Working Paper Series 03/31, New Zealand Treasury.
    10. Robert Ewing & Bryn Battersby, 2005. "Measuring recent trends in Australia’s economic remoteness," Economic Roundup, The Treasury, Australian Government, issue 1, pages 21-31, March.
    11. Bryn Battersby, 2007. "Does distance matter?: The effect of geographic isolation on productivity levels," OECD Economic Studies, OECD Publishing, vol. 2006(1), pages 205-225.
    12. Stephen Redding & Anthony J. Venables, 2002. "The Economics of Isolation and Distance," Nordic Journal of Political Economy, Nordic Journal of Political Economy, vol. 28, pages 93-108.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Gregory, Robert G., 2012. "Living standards, terms of trade and foreign ownership: reflections on the Australian mining boom," Australian Journal of Agricultural and Resource Economics, Australian Agricultural and Resource Economics Society, vol. 56(2), June.
    2. Evans, Lewis, 2009. "Capital Market Integration: The Structure of the New Zealand Economy and its Capital Markets," Working Paper Series 4035, Victoria University of Wellington, The New Zealand Institute for the Study of Competition and Regulation.
    3. Ben Dolman & Lan Lu & Jyoti Rahman, 2006. "Understanding productivity trends," Economic Roundup, The Treasury, Australian Government, issue 1, pages 35-52, March.
    4. Gene Tunny, 2006. "Educational attainment in Australia," Economic Roundup, The Treasury, Australian Government, issue 2, pages 1-9, May.
    5. Dean Parham, 2005. "Is Australia’s Productivity Surge Over?," Agenda - A Journal of Policy Analysis and Reform, Australian National University, College of Business and Economics, School of Economics, vol. 12(3), pages 253-266.

    More about this item

    Keywords

    gross domestic product; human capital; microeconomics; productivity;

    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

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:tsy:journl:journl_tsy_er_2005_2_2. 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: (The Treasury (Commonwealth of Australia)). General contact details of provider: http://edirc.repec.org/data/trgovau.html .

    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 CitEc recognized a reference but did not link an item in RePEc 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 RePEc Author Service 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.

    IDEAS is a RePEc service hosted by the Research Division of the Federal Reserve Bank of St. Louis . RePEc uses bibliographic data supplied by the respective publishers.