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Do Technology Shocks Lead to Productivity Slowdowns? Evidence From Patent Data

  • Lone Engbo Christiansen
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    This paper provides empirical evidence on the response of labor productivity to the arrival of new inventions. The benchmark measure of technological progress is given by data on patent applications in the U.S. over the period 1889-2002. The analysis shows that labor productivity may temporarily fall below trend after technological progress. However, the effects on productivity differ between the pre- and post-World War II periods. The pre-war period shows evidence of a productivity slowdown as a result of the arrival of new technology, whereas the post-World War II period does not. Positive effects of technology shocks tend to show up sooner in the productivity data in the later period.

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    File URL: http://www.imf.org/external/pubs/cat/longres.aspx?sk=21613
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    Paper provided by International Monetary Fund in its series IMF Working Papers with number 08/24.

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    Length: 54
    Date of creation: 01 Jan 2008
    Date of revision:
    Handle: RePEc:imf:imfwpa:08/24
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    1. Susanto Basu & John Fernald & Miles Kimball, 2004. "Are technology improvements contractionary?," Working Paper Series WP-04-20, Federal Reserve Bank of Chicago.
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    7. Bronwyn H. Hall & Adam B. Jaffe & Manuel Trajtenberg, 2001. "The NBER Patent Citation Data File: Lessons, Insights and Methodological Tools," NBER Working Papers 8498, National Bureau of Economic Research, Inc.
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    11. Perron, P, 1988. "The Great Crash, The Oil Price Shock And The Unit Root Hypothesis," Papers 338, Princeton, Department of Economics - Econometric Research Program.
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    27. repec:fth:harver:1473 is not listed on IDEAS
    28. Andreas Hornstein & Per Krusell, 1996. "Can Technology Improvements Cause Productivity Slowdowns?," NBER Chapters, in: NBER Macroeconomics Annual 1996, Volume 11, pages 209-276 National Bureau of Economic Research, Inc.
    29. Lach, Saul, 1995. "Patents and productivity growth at the industry level: A first look," Economics Letters, Elsevier, vol. 49(1), pages 101-108, July.
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