IDEAS home Printed from https://ideas.repec.org/a/ucp/jpolec/doi10.1086-720763.html

Aggregate Implications of Changing Sectoral Trends

Author

Listed:
  • Andrew T. Foerster
  • Andreas Hornstein
  • Pierre-Daniel G. Sarte
  • Mark W. Watson

Abstract

We describe how capital accumulation and the network structure of US production interact to amplify the effects of sectoral trend growth rates in total factor productivity and labor on trend GDP (gross domestic product) growth. We derive expressions that conveniently summarize this long-run amplification effect by way of sectoral multipliers. We estimate that sector-specific factors have historically accounted for approximately three-fourths of long-run changes in GDP growth. Trend GDP growth fell by nearly 3 percentage points over the postwar period, with especially significant contributions from the Construction sector in 1950–80 and the Durable Goods sector in 2000–2018. No sector has contributed any steady significant increase to the trend growth rate of GDP in the past 70 years.

Suggested Citation

  • Andrew T. Foerster & Andreas Hornstein & Pierre-Daniel G. Sarte & Mark W. Watson, 2022. "Aggregate Implications of Changing Sectoral Trends," Journal of Political Economy, University of Chicago Press, vol. 130(12), pages 3286-3333.
    • Handle: RePEc:ucp:jpolec:doi:10.1086/720763
    DOI: 10.1086/720763
    as

    Download full text from publisher

    File URL: http://dx.doi.org/10.1086/720763
    Download Restriction: Access to the online full text or PDF requires a subscription.
    File URL: http://dx.doi.org/10.1086/720763
    Download Restriction: Access to the online full text or PDF requires a subscription.
    File URL: https://libkey.io/10.1086/720763?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to look for a different version below or

    for a different version of it.

    Other versions of this item:

    More about this item

    JEL classification:

    • C32 - Mathematical and Quantitative Methods - - Multiple or Simultaneous Equation Models; Multiple Variables - - - Time-Series Models; Dynamic Quantile Regressions; Dynamic Treatment Effect Models; Diffusion Processes; State Space Models
    • E23 - Macroeconomics and Monetary Economics - - Consumption, Saving, Production, Employment, and Investment - - - Production
    • O41 - Economic Development, Innovation, Technological Change, and Growth - - Economic Growth and Aggregate Productivity - - - One, Two, and Multisector Growth Models

    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:ucp:jpolec:doi:10.1086/720763. See general information about how to correct material in RePEc.

    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.

    We have no bibliographic references for this item. You can help adding them by using 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.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Journals Division (email available below). General contact details of provider: https://www.journals.uchicago.edu/JPE .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.