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New International Comparisons Of Productivity Performance: A Sectoral Analysis And A Comparison Of Uk Performance

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  • Jim Malley
  • Anton Muscatelli
  • Ulrich Woitek

Abstract

In this paper we present several new measures of gross-output-based total factor (multifactor) productivity (TFP) at the sectoral level for manufacturing industries in the G7 economies. We calculate measures of both total factor productivity growth and comparative productivity levels. These are obtained by combining conventional OECD sectoral data on labour and capital inputs with data on intermediate inputs from national input-output tables. Additionally, we derive cyclically corrected measures of TFP growth that avoid the distortions contained in traditional measures of productivity growth. Consequently we argue that our measures provide a more accurate description of the underlying rate of productivity growth in the G7 economies. Our evidence shows little convergence of productivity in other G7 countries to US levels. A key conclusion from the UK’s perspective is that in manufacturing, the productivity gap with other major industrialised countries, especially the USA and Germany, is bigger than has been reported in other recent studies (O’Mahony, 1999, HM Treasury, 2000).

Suggested Citation

  • Jim Malley & Anton Muscatelli & Ulrich Woitek, 2000. "New International Comparisons Of Productivity Performance: A Sectoral Analysis And A Comparison Of Uk Performance," Working Papers 2000_17, Business School - Economics, University of Glasgow.
  • Handle: RePEc:gla:glaewp:2000_17
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    References listed on IDEAS

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    1. Caballero, Ricardo J. & Lyons, Richard K., 1992. "External effects in U.S. procyclical productivity," Journal of Monetary Economics, Elsevier, vol. 29(2), pages 209-225, April.
    2. D. W. Jorgenson & Z. Griliches, 1967. "The Explanation of Productivity Change," Review of Economic Studies, Oxford University Press, vol. 34(3), pages 249-283.
    3. Craig Burnside & Martin Eichenbaum & Sergio Rebelo, 1995. "Capital Utilization and Returns to Scale," NBER Chapters,in: NBER Macroeconomics Annual 1995, Volume 10, pages 67-124 National Bureau of Economic Research, Inc.
    4. Harrigan, James, 1999. "Estimation of cross-country differences in industry production functions," Journal of International Economics, Elsevier, vol. 47(2), pages 267-293, April.
    5. Charles R. Hulten, 2000. "Total Factor Productivity: A Short Biography," NBER Working Papers 7471, National Bureau of Economic Research, Inc.
    6. Ramey, Valerie A, 1989. "Inventories as Factors of Production and Economic Fluctuations," American Economic Review, American Economic Association, vol. 79(3), pages 338-354, June.
    7. Keith E. Maskus, 1991. "Comparing International Trade Data and Product and National Characteristics Data for the Analysis of Trade Models," NBER Chapters,in: International Economic Transactions: Issues in Measurement and Empirical Research, pages 17-60 National Bureau of Economic Research, Inc.
    8. Susanto Basu & Miles S. Kimball, 1997. "Cyclical Productivity with Unobserved Input Variation," NBER Working Papers 5915, National Bureau of Economic Research, Inc.
    9. Caves, Douglas W & Christensen, Laurits R & Diewert, W Erwin, 1982. "Multilateral Comparisons of Output, Input, and Productivity Using Superlative Index Numbers," Economic Journal, Royal Economic Society, vol. 92(365), pages 73-86, March.
    10. Susanto Basu & John Fernald, 2001. "Why Is Productivity Procyclical? Why Do We Care?," NBER Chapters,in: New Developments in Productivity Analysis, pages 225-302 National Bureau of Economic Research, Inc.
    11. Jim Malley & Anton Muscatelli & Ulrich Woitek, 1998. "The Interaction Between Business Cycles and Productivity Growth: Evidence from US Industrial Data," Working Papers 9805, Business School - Economics, University of Glasgow, revised Oct 1998.
    12. repec:fth:harver:1487 is not listed on IDEAS
    13. David Dollar & Edward N. Wolff, 1993. "Competitiveness, Convergence, and International Specialization," MIT Press Books, The MIT Press, edition 1, volume 1, number 0262041359, January.
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    More about this item

    JEL classification:

    • O47 - Economic Development, Innovation, Technological Change, and Growth - - Economic Growth and Aggregate Productivity - - - Empirical Studies of Economic Growth; Aggregate Productivity; Cross-Country Output Convergence
    • D24 - Microeconomics - - Production and Organizations - - - Production; Cost; Capital; Capital, Total Factor, and Multifactor Productivity; Capacity

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