IDEAS home Printed from
MyIDEAS: Login to save this paper or follow this series

Growth and productivity in the service sector: The state of the art

  • Andrés Maroto-Sanchez
Registered author(s):

    Literature on growth accounting has generally introduced productivity to explain the growth of services. One of the most conventional statements in economics, with regard to the services sector suggests that, as a whole, this sector has a lower productivity level than the other productive sectors, and that its growth is always quite slow. Such a statement is based initially on the personal nature of many services, which makes it difficult to substitute the work for capital factor and the incorporation of technical progress. From this approach we can derive the relative lower productivity in some advanced economies (such as the European countries versus the United States and some particular emergent economies) as an explanation of the growth of the tertiary sector. In this working paper, we will look in greater depth at issues related to services productivity, from conceptual aspects regarding the definition and meaning of productivity, to methodological and measurement of services productivity. This paper is essentially a necessary state of the art of relationships between economic growth and productivity within services sector, reviewing not only the conventional literature but also those new waves of thinking.

    If you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.

    File URL:
    File Function: First version, 2010
    Download Restriction: no

    Paper provided by Instituto Universitario de Análisis Económico y Social in its series Working Papers with number 07/10.

    in new window

    Length: 50 pages
    Date of creation: Jul 2010
    Date of revision:
    Handle: RePEc:uae:wpaper:0710
    Contact details of provider: Postal: Plaza de la Victoria, 2 C.P. 28802, Alcalá de Henares
    Phone: (00 34) 91 885 52 25
    Fax: (00 34) 91 885 52 11
    Web page:

    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.:

    as in new window
    1. Samuel S. Kortum, 1997. "Research, Patenting, and Technological Change," Econometrica, Econometric Society, vol. 65(6), pages 1389-1420, November.
    2. Rashmi Banga & B.N.Goldar, 2004. "Contribution of services to output growth and productivity in Indian manufacturing: Pre and post reforms," Indian Council for Research on International Economic Relations, New Delhi Working Papers 139, Indian Council for Research on International Economic Relations, New Delhi, India.
    3. D. C. A. Curtis & K. S. R. Murthy, 1998. "Economic growth and restructuring: a test of unbalanced growth models - 1977-1992," Applied Economics Letters, Taylor & Francis Journals, vol. 5(12), pages 777-780.
    4. Antonio Ciccone & Robert E. Hall, 1995. "Productivity and the density of economic activity," Economics Working Papers 120, Department of Economics and Business, Universitat Pompeu Fabra.
    5. Peter Howitt, 2000. "Endogenous Growth and Cross-Country Income Differences," American Economic Review, American Economic Association, vol. 90(4), pages 829-846, September.
    6. Aghion, Philippe & Howitt, Peter, 1992. "A Model of Growth Through Creative Destruction," Scholarly Articles 12490578, Harvard University Department of Economics.
    7. Aghion, P. & Howitt, P., 1990. "A Model Of Growth Through Creative Destruction," DELTA Working Papers 90-12, DELTA (Ecole normale supérieure).
    8. Jan Fagerberg, 2000. "Technological Progress, Structural Change and Productivity Growth: A Comparative Study," Working Papers 5, Centre for Technology, Innovation and Culture, University of Oslo.
    9. Reinert, Erik S., 1995. "Competitiveness and its predecessors--a 500-year cross-national perspective," Structural Change and Economic Dynamics, Elsevier, vol. 6(1), pages 23-42, March.
    10. John Haltiwanger, 1997. "Measuring and analyzing aggregate fluctuations: the importance of building from microeconomic evidence," Review, Federal Reserve Bank of St. Louis, issue May, pages 55-78.
    11. Kongsamut, Piyabha & Rebelo, Sérgio & Xie, Danyang, 1997. "Beyond Balanced Growth," CEPR Discussion Papers 1693, C.E.P.R. Discussion Papers.
    12. Gustavo Crespi & Chiara Criscuolo & Jonathan Haskel & Denise Hawkes, 2006. "Measuring and Understanding Productivity in UK Market Services," Oxford Review of Economic Policy, Oxford University Press, vol. 22(4), pages 560-572, Winter.
    13. Martin Neil Baily & Robert J. Gordon, 1988. "The Productivity Slowdown, Measurement Issues, and the Explosion of Computer Power," Brookings Papers on Economic Activity, Economic Studies Program, The Brookings Institution, vol. 19(2), pages 347-432.
    14. Dosi, Giovanni, 1988. "Sources, Procedures, and Microeconomic Effects of Innovation," Journal of Economic Literature, American Economic Association, vol. 26(3), pages 1120-71, September.
    15. Wolff, Edward N., 1984. "Industrial Composition, Interindustry Effects, and the US Productivity Slowdown," Working Papers 84-09, C.V. Starr Center for Applied Economics, New York University.
    16. Reto Foellmi & Josef Zweilmueller, 2006. "Structural Change and the Kaldor Facts of Economic Growth," 2006 Meeting Papers 342, Society for Economic Dynamics.
    17. Metcalfe, John S. & Foster, John & Ramlogan, Ronnie, 2003. "Adaptive Economic Growth," Centre on Regulation and Competition (CRC) Working papers 30637, University of Manchester, Institute for Development Policy and Management (IDPM).
    18. Steven N. Durlauf, 1991. "Nonergodic Economic Growth," NBER Working Papers 3719, National Bureau of Economic Research, Inc.
    19. Nicholas Oulton, 2000. "Must the growth rate decline? Baumol's unbalanced growth revisited," Bank of England working papers 107, Bank of England.
    20. Dunne, T. & Roberts, M.J. & Samuelson, L., 1988. "Pattenrs Of Firm Entry And Exit In U.S. Manufacturing Industries," Papers 1-88-2, Pennsylvania State - Department of Economics.
    21. Jochen Hartwig, 2008. "Productivity Growth In Service Industries: Are The Transatlantic Differences Measurement-Driven?," Review of Income and Wealth, International Association for Research in Income and Wealth, vol. 54(3), pages 494-505, 09.
    22. Luis Rubalcaba, 2007. "Services in European Policies," Bruges European Economic Policy Briefings 16, European Economic Studies Department, College of Europe.
    23. Nelson, Richard R & Wright, Gavin, 1992. "The Rise and Fall of American Technological Leadership: The Postwar Era in Historical Perspective," Journal of Economic Literature, American Economic Association, vol. 30(4), pages 1931-64, December.
    24. Metcalfe, J S, 1994. "Competition, Fisher's Principle and Increasing Returns in the Selection Process," Journal of Evolutionary Economics, Springer, vol. 4(4), pages 327-46, November.
    25. Robert L. Mansell, 1985. "The Service Sector and Western Economic Growth," Canadian Public Policy, University of Toronto Press, vol. 11(s1), pages 354-360, July.
    26. Dosi, Giovanni & Nelson, Richard R, 1994. "An Introduction to Evolutionary Theories in Economics," Journal of Evolutionary Economics, Springer, vol. 4(3), pages 153-72, September.
    27. Nelson, Randy A & Tanguay, Tim L & Patterson, Christopher D, 1994. "A Quality-Adjusted Price Index for Personal Computers," Journal of Business & Economic Statistics, American Statistical Association, vol. 12(1), pages 23-31, January.
    28. S. Necmi, 1999. "Kaldor's growth analysis revisited," Applied Economics, Taylor & Francis Journals, vol. 31(5), pages 653-660.
    29. Ernst R. Berndt & Zvi Griliches & Neal Rappaport, 1993. "Econometric Estimates of Prices Indexes for Personal Computers in the 1990s," NBER Working Papers 4549, National Bureau of Economic Research, Inc.
    30. Peter Mawson & Kenneth I Carlaw & Nathan McLellan, 2003. "Productivity Measurement: Alternative Approaches and Estimates," Treasury Working Paper Series 03/12, New Zealand Treasury.
    31. Nadim Ahmad & François Lequiller & Pascal Marianna & Dirk Pilat & Paul Schreyer & Anita Wölfl, 2003. "Comparing Labour Productivity Growth in the OECD Area: The Role of Measurement," OECD Statistics Working Papers 2003/5, OECD Publishing.
    32. Colwell, R J & Davis, E P, 1992. " Output and Productivity in Banking," Scandinavian Journal of Economics, Wiley Blackwell, vol. 94(0), pages S111-29, Supplemen.
    Full references (including those not matched with items on IDEAS)

    This item is not listed on Wikipedia, on a reading list or among the top items on IDEAS.

    When requesting a correction, please mention this item's handle: RePEc:uae:wpaper:0710. 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: (Laura Suarez)

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If references are entirely missing, you can add them using this form.

    If the full references list an item that is present in RePEc, but the system did not link to it, you can help with this form.

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your profile, as there may be some citations waiting for confirmation.

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    This information is provided to you by IDEAS at the Research Division of the Federal Reserve Bank of St. Louis using RePEc data.