Recent productivity outcomes and Australia’s potential growth
In recent years, employment has grown strongly while output has grown modestly. This implies a weak growth in labour productivity that is difficult to interpret. In this article, we explore some possible explanations for recent economic growth and labour productivity outcomes, with a focus on developments in the composition of growth. We also examine whether recent productivity outcomes hold any implications for the Australian economy's potential growth rate. We find that recent weak growth in output and strong growth in labour are indeed unusual when compared with previous experiences. However, we also find that the uncommon circumstances surrounding Australia’s mining boom explain some of the output and labour conundrum.
Volume (Year): (2007)
Issue (Month): 3 (September)
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- Robert J. Hodrick & Edward Prescott, 1981.
"Post-War U.S. Business Cycles: An Empirical Investigation,"
451, Northwestern University, Center for Mathematical Studies in Economics and Management Science.
- Hodrick, Robert J & Prescott, Edward C, 1997. "Postwar U.S. Business Cycles: An Empirical Investigation," Journal of Money, Credit and Banking, Blackwell Publishing, vol. 29(1), pages 1-16, February.
- Ben Dolman & Lan Lu & Jyoti Rahman, 2006. "Understanding productivity trends," Economic Roundup, The Treasury, Australian Government, issue 1, pages 35-52, March.
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