Why did UK manufacturing productivity growth slow down in the 1970s and speed up in the 1980s
After a dramatic slowdown of the 1970s, productivity growth in UK manufacturing in the 1980s returned to something like its pre-slowdown trend. This paper constructs a quarterly dynamic model of TFP growth in UK manufacturing using cointegration techniques, correcting for a variety of measurement biases. The elasticity of output with respect to R&D capital is estimated at between 0.2 and 0.3, with human capital also playing a positive and significant role. The paper also determines how much of the UK productivity slowdown in the 1970s was due to the mis-measurement of output and the business cycle and how much was due to structural changes. The answer appears to be about half and half.
|Date of creation:||01 Aug 1999|
|Date of revision:|
|Contact details of provider:|| Postal: Manor Rd. Building, Oxford, OX1 3UQ|
Web page: http://www.economics.ox.ac.uk/
More information through EDIRC
References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Lucas, Robert Jr., 1988. "On the mechanics of economic development," Journal of Monetary Economics, Elsevier, vol. 22(1), pages 3-42, July.
- Haskel, Jonathan, 1996.
"Small Firms, Contracting-out, Computers and Wage Inequality: Evidence from UK Manufacturing,"
CEPR Discussion Papers
1490, C.E.P.R. Discussion Papers.
- Haskel, Jonathan, 1999. "Small Firms, Contracting-Out, Computers and Wage Inequality: Evidence from UK Manufacturing," Economica, London School of Economics and Political Science, vol. 66(261), pages 1-21, February.
- Robert J. Barro, 1989.
"Economic Growth in a Cross Section of Countries,"
NBER Working Papers
3120, National Bureau of Economic Research, Inc.
- Mansfield, Edwin, 1985. "How Rapidly Does New Industrial Technology Leak Out?," Journal of Industrial Economics, Wiley Blackwell, vol. 34(2), pages 217-23, December.
- Ulph, A. M. & Ulph, D. T., 1994. "Labour markets and innovation: Ex-post bargaining," European Economic Review, Elsevier, vol. 38(1), pages 195-210, January.
- Denny, K. & Nickell, S., 1990.
"Unions And Investment In British Industry,"
Economics Series Working Papers
9992, University of Oxford, Department of Economics.
- Johansen, Soren, 1988. "Statistical analysis of cointegration vectors," Journal of Economic Dynamics and Control, Elsevier, vol. 12(2-3), pages 231-254.
- Hendry, David F., 1995. "Dynamic Econometrics," OUP Catalogue, Oxford University Press, number 9780198283164, July.
- Gavin Cameron & James Proudman & Stephen Redding, 1997.
"Deconstructing Growth in UK Manufacturing,"
Bank of England working papers
73, Bank of England.
- Purcell, John, 1991. "The Rediscovery of the Management Prerogative: The Management of Labour Relations in the 1980s," Oxford Review of Economic Policy, Oxford University Press, vol. 7(1), pages 33-43, Spring.
- Roeger, Werner, 1995. "Can Imperfect Competition Explain the Difference between Primal and Dual Productivity Measures? Estimates for U.S. Manufacturing," Journal of Political Economy, University of Chicago Press, vol. 103(2), pages 316-30, April.
- White, Halbert, 1980. "A Heteroskedasticity-Consistent Covariance Matrix Estimator and a Direct Test for Heteroskedasticity," Econometrica, Econometric Society, vol. 48(4), pages 817-38, May.
- Gavin Cameron, 1996. "On the measurement of real R&D: Divisia price indices for UK business enterprise R&D," Research Evaluation, Oxford University Press, vol. 6(3), pages 215-219, December.
- Paul M Romer, 1999.
"Endogenous Technological Change,"
Levine's Working Paper Archive
2135, David K. Levine.
- Muellbauer, John, 1984. "Aggregate Production Functions and Productivity Measurement: A New Look," CEPR Discussion Papers 34, C.E.P.R. Discussion Papers.
- Stephen Machin, 1995.
"Changes in the Relative Demand for Skills in the UK Labour Market,"
CEP Discussion Papers
dp0221, Centre for Economic Performance, LSE.
- Machin, Steve, 1994. "Changes in the Relative Demand for Skills in the UK Labour Market," CEPR Discussion Papers 952, C.E.P.R. Discussion Papers.
- Gregg, Paul & Machin, Stephen & Metcalf, David, 1993. "Signals and Cycles? Productivity Growth and Changes in Union Status in British Companies, 1984-9," Economic Journal, Royal Economic Society, vol. 103(419), pages 894-907, July.
- Muellbauer, John, 1991. "Productivity and Competitiveness," Oxford Review of Economic Policy, Oxford University Press, vol. 7(3), pages 99-117, Autumn.
- Jarque, Carlos M. & Bera, Anil K., 1980. "Efficient tests for normality, homoscedasticity and serial independence of regression residuals," Economics Letters, Elsevier, vol. 6(3), pages 255-259.
- G Cameron & J Proudman & Stephen Redding, 1999. "Productivity Growth, Convergence, and Trade in a Panel of Manufacturing Industries," CEP Discussion Papers dp0428, Centre for Economic Performance, LSE.
- Eicher, Theo S., 1999. "Trade, development and converging growth rates: Dynamic gains from trade reconsidered," Journal of International Economics, Elsevier, vol. 48(1), pages 179-198, June.
- Benhabib, Jess & Spiegel, Mark M., 1994. "The role of human capital in economic development evidence from aggregate cross-country data," Journal of Monetary Economics, Elsevier, vol. 34(2), pages 143-173, October.
- Michael L. Katz & Carl Shapiro, 1994. "Systems Competition and Network Effects," Journal of Economic Perspectives, American Economic Association, vol. 8(2), pages 93-115, Spring.
When requesting a correction, please mention this item's handle: RePEc:oxf:wpaper:1999-w24. See general information about how to correct material in RePEc.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Monica Birds)
If references are entirely missing, you can add them using this form.