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Productivity Growth in Service Industries: An Assessment of Recent Patterns and the Role of Measurement

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  • Anita Wölfl

Abstract

This paper examines recent patterns in productivity growth of service industries and analyses the role of problems in measuring service productivity growth on industry and aggregate productivity growth. At the aggregate level, unbalanced growth can be observed between a dynamic manufacturing sector on one hand and a rather stagnant service sector on the other. The service sector itself is, however, composed of a set of heterogenous industries with productivity growth rates ranging from low or negative rates to growth rates exceeding those of high-growth manufacturing industries. The empirical evidence suggests that low or negative productivity growth rates in several services are linked to measurement problems. Computing constant price service output is particularly important. Potential under-estimation of service productivity growth leads eventually to an under-estimation of aggregate productivity growth, via aggregation effects and the flows of intermediate inputs. There ... Croissance de la productivité dans le secteur des services analyse des tendances actuelles et rôle de la mesure Le présent document examine les tendances de la croissance de la productivité dans les industries de services, et analyse le rôle des problèmes rencontrés pour mesurer la croissance de la productivité des services au niveau sectoriel et global. Au niveau global, on observe un déséquilibre de la croissance entre un secteur manufacturier dynamique d’un côté, et un secteur des services plutôt atone de l’autre. Le secteur des services lui-même se compose néanmoins d’un éventail d’industries hétérogènes dont la croissance de la productivité oscille entre des taux faibles ou négatifs et des taux supérieurs à ceux des industries manufacturières à forte croissance. Les données empiriques indiquent que les taux faibles ou négatifs de plusieurs domaines de services sont liés à des problèmes de mesure. La valorisation de la production de services est un point particulièrement important. La sous-estimation potentielle de la croissance de la productivité de services aboutit, en raison d’effets ...

Suggested Citation

  • Anita Wölfl, 2003. "Productivity Growth in Service Industries: An Assessment of Recent Patterns and the Role of Measurement," OECD Science, Technology and Industry Working Papers 2003/7, OECD Publishing.
  • Handle: RePEc:oec:stiaaa:2003/7-en
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    File URL: http://dx.doi.org/10.1787/086461104618
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    Cited by:

    1. Hartwig, Jochen, 2008. "What drives health care expenditure?--Baumol's model of 'unbalanced growth' revisited," Journal of Health Economics, Elsevier, vol. 27(3), pages 603-623, May.
    2. Lee, Jong-Wha, 2005. "Human capital and productivity for Korea's sustained economic growth," Journal of Asian Economics, Elsevier, vol. 16(4), pages 663-687, August.
    3. Paul Baker & Neil Foster-McGregor & Koenen Johannes & Sandra M. Leitner & Julia Schricker & Robert Stehrer & Thomas Strobel & Jurgen Vermeulen & Hans-Günther Vieweg & Anastasia Yagafarova, 2015. "The Relation between Industry and Services in Terms of Productivity and Value Creation," wiiw Research Reports 404, The Vienna Institute for International Economic Studies, wiiw.
    4. Jochen Hartwig, 2005. "Sind unsere gesamtwirtschaftlichen Probleme ueberhaupt loesbar?," KOF Working papers 05-112, KOF Swiss Economic Institute, ETH Zurich.
    5. Saltari, Enrico & Wymer, Clifford R. & Federici, Daniela, 2013. "The impact of ICT and business services on the Italian economy," Structural Change and Economic Dynamics, Elsevier, vol. 25(C), pages 110-118.
    6. Anita Wölfl, 2004. "Productivity Growth in Services Industries: Is There a Role for Measurement?," International Productivity Monitor, Centre for the Study of Living Standards, vol. 8, pages 66-80, Spring.
    7. repec:clr:wugarc:y:2011:v:37i:2p:269 is not listed on IDEAS
    8. Zúniga-González, Carlos Alberto, 2012. "Current expenditure impact on the municipality management productivity of Nicaragua, 2007-2011," Working Papers 140548, National Autonomous University of Nicaragua, León (Unan-León), Researching Center for Applied Economic (RCAE).
    9. Rabeh Morrar & Faïz Gallouj, 2016. "The growth of the service sector in Palestine: the productivity challenge," Journal of Innovation Economics, De Boeck Université, vol. 0(1), pages 179-204.
    10. Esther Gordo & Javier Jareño & Alberto Urtasun, 2006. "Radiografía del sector servicios en España," Occasional Papers 0607, Banco de España;Occasional Papers Homepage.
    11. Jochen Hartwig, 2007. "Ist die «Baumol’sche Krankheit» geheilt?," KOF Analysen, KOF Swiss Economic Institute, ETH Zurich, vol. 1(4), pages 23-31, December.
    12. Cassidy, Mark, 2004. "Productivity in Ireland: Trends and Issues," Quarterly Bulletin Articles, Central Bank of Ireland, pages 83-105, April.
    13. Jochen Hartwig, 2008. "Has Health Capital Formation Cured 'Baumol's Disease'? - Panel Granger Causality Evidence for OECD Countries," KOF Working papers 08-206, KOF Swiss Economic Institute, ETH Zurich.
    14. Alexander Eickelpasch & Georg Erber, 2014. "Analyse der Ansatzpunkte der volkswirtschaftlichen Produktivitätsanalyse von wissensintensiven Dienstleistungen in der amtlichen Statistik: Endbericht; Forschungsprojekt im Auftrag des Fraunhofer-Inst," DIW Berlin: Politikberatung kompakt, DIW Berlin, German Institute for Economic Research, volume 80, number pbk80.
    15. Maroto-Sánchez, Andrés & Cuadrado-Roura, Juan R., 2009. "Is growth of services an obstacle to productivity growth? A comparative analysis," Structural Change and Economic Dynamics, Elsevier, vol. 20(4), pages 254-265, December.
    16. Henk L.M. Kox, 2004. "The contribution of business services to aggregate productivity growth," Industrial Organization 0402005, EconWPA.
    17. Robert Inklaar & Marcel P. Timmer & Bart van Ark, 2008. "Data for Productivity Measurement in Market Services: An International Comparison," International Productivity Monitor, Centre for the Study of Living Standards, vol. 16, pages 72-81, Spring.
    18. Mitsuru Mizuno, 2005. "Development Of The Service Sector In Japan And Its Implications For The Economy," Pacific Economic Review, Wiley Blackwell, vol. 10(4), pages 485-492, December.

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