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Sectoral energy- and labour-productivity convergence

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  • Peter Mulder

    (CPB Netherlands Bureau for Economic Policy Analysis)

  • Henri de Groot

    (CPB Netherlands Bureau for Economic Policy Analysis)

Abstract

This paper provides an empirical analysis of convergence patterns for energy- and labour-productivity developments at a detailed sectoral level for 14 OECD countries, covering the period 1970-1997. Cross-country differences of energy-productivity levels are shown to be substantially larger than cross-country differences of labour-productivity levels at all levels of sectoral aggregation. A s-convergence analysis shows that the development of cross-country variation in productivity performance depends on the level of aggregation. Both patterns of international productivity convergence and divergence exist across sectors. Using a panel-data approach, we find in most sectors energy productivity to grow relatively fast in countries with relatively low initial productivity levels, while in several sectors this is also true for labour productivity. This evidence of ß-convergence supports the hypothesis that lagging countries tend to catch up with technological leaders, in particular in terms of energy productivity. Moreover, the results show that convergence is conditional rather than unconditional, meaning that productivity levels converge to country-specific steady states. Searching for the fundamentals determining cross-country productivity differentials reveals a positive productivity effect of energy prices and economies of scale in several sectors, while wages, investment share, openness and specialisation play only a very limited role in explaining (cross-country differences in) energy- and labour-productivity growth.

Suggested Citation

  • Peter Mulder & Henri de Groot, 2003. "Sectoral energy- and labour-productivity convergence," CPB Discussion Paper 23, CPB Netherlands Bureau for Economic Policy Analysis.
  • Handle: RePEc:cpb:discus:23
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    References listed on IDEAS

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    1. Machiel Dijk & Richard Nahuis & Daniel Waagmeester, 2006. "Does Public Service Broadcasting Serve The Public? The Future of Television in the Changing Media Landscape," De Economist, Springer, vol. 154(2), pages 251-276, June.
    2. Miketa, Asami & Mulder, Peter, 2005. "Energy productivity across developed and developing countries in 10 manufacturing sectors: Patterns of growth and convergence," Energy Economics, Elsevier, vol. 27(3), pages 429-453, May.
    3. repec:eee:appene:v:213:y:2018:i:c:p:112-122 is not listed on IDEAS
    4. Peter Mulder & Henri de Groot, 2003. "International comparison of sectoral energy- and labour-productivity performance; stylised facts and decomposition of trends," CPB Discussion Paper 22, CPB Netherlands Bureau for Economic Policy Analysis.
    5. Bretschger, Lucas, 2015. "Energy prices, growth, and the channels in between: Theory and evidence," Resource and Energy Economics, Elsevier, vol. 39(C), pages 29-52.
    6. repec:eee:appene:v:211:y:2018:i:c:p:743-754 is not listed on IDEAS
    7. repec:eee:eneeco:v:69:y:2018:i:c:p:111-127 is not listed on IDEAS
    8. Lucas Bretschger & Sjak Smulders, 2007. "Sustainable Resource Use and Economic Dynamics," Environmental & Resource Economics, Springer;European Association of Environmental and Resource Economists, vol. 36(1), pages 1-13, January.
    9. Peter Mulder, 2015. "International Specialization, Structural Change and the Evolution of Manufacturing Energy Intensity in OECD Countries," The Energy Journal, International Association for Energy Economics, vol. 0(Number 3).
    10. Giulio Guarini & Giuseppe Garofalo & Alessandro Federici, 2014. "A Virtuous Cumulative Growth Circle among Innovation, Inclusion and Sustainability? A Structuralist-Keynesian Analysis with an Application on Europe," GREDEG Working Papers 2014-39, Groupe de REcherche en Droit, Economie, Gestion (GREDEG CNRS), University of Nice Sophia Antipolis.
    11. repec:eee:eneeco:v:72:y:2018:i:c:p:313-320 is not listed on IDEAS

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    JEL classification:

    • O13 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Agriculture; Natural Resources; Environment; Other Primary Products
    • O47 - Economic Development, Innovation, Technological Change, and Growth - - Economic Growth and Aggregate Productivity - - - Empirical Studies of Economic Growth; Aggregate Productivity; Cross-Country Output Convergence
    • O5 - Economic Development, Innovation, Technological Change, and Growth - - Economywide Country Studies
    • Q43 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Energy - - - Energy and the Macroeconomy

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