IDEAS home Printed from https://ideas.repec.org/a/aea/aejmac/v16y2024i3p160-89.html
   My bibliography  Save this article

World Productivity: 1996–2014

Author

Listed:
  • Mehrdad Esfahani
  • John G. Fernald
  • Bart Hobijn

Abstract

We use a new growth accounting method to quantify the drivers of world total factor productivity (TFP) growth during 1996–2014 and uncover four main results. World productivity growth is volatile from year to year. This mainly reflects reallocation of labor across country-industries. The contribution of country-industry level productivity growth to world productivity is relatively constant over time. This constancy masks that the increased importance of emerging economies offsets a productivity slowdown in advanced economies. After 2008, this offsetting effect dissipated and world TFP growth declined. These conclusions are robust to the inclusion of markups in the analysis.

Suggested Citation

  • Mehrdad Esfahani & John G. Fernald & Bart Hobijn, 2024. "World Productivity: 1996–2014," American Economic Journal: Macroeconomics, American Economic Association, vol. 16(3), pages 160-189, July.
    • Handle: RePEc:aea:aejmac:v:16:y:2024:i:3:p:160-89
    DOI: 10.1257/mac.20200480
    as

    Download full text from publisher

    File URL: https://www.aeaweb.org/doi/10.1257/mac.20200480
    Download Restriction: no
    File URL: https://doi.org/10.3886/E187401V1
    Download Restriction: no
    File URL: https://www.aeaweb.org/doi/10.1257/mac.20200480.appx
    Download Restriction: no
    File URL: https://www.aeaweb.org/doi/10.1257/mac.20200480.ds
    Download Restriction: Access to full text is restricted to AEA members and institutional subscribers.
    File URL: https://libkey.io/10.1257/mac.20200480?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    Other versions of this item:

    References listed on IDEAS

    as
    1. Cette, Gilbert & Fernald, John & Mojon, Benoît, 2016. "The pre-Great Recession slowdown in productivity," European Economic Review, Elsevier, vol. 88(C), pages 3-20.
    2. Charles R. Hulten, 1978. "Growth Accounting with Intermediate Inputs," The Review of Economic Studies, Review of Economic Studies Ltd, vol. 45(3), pages 511-518.
    3. Robert C. Feenstra & Robert Inklaar & Marcel P. Timmer, 2015. "The Next Generation of the Penn World Table," American Economic Review, American Economic Association, vol. 105(10), pages 3150-3182, October.
    4. Stephen D. Oliner & Daniel E. Sichel, 2000. "The Resurgence of Growth in the Late 1990s: Is Information Technology the Story?," Journal of Economic Perspectives, American Economic Association, vol. 14(4), pages 3-22, Fall.
    5. Basu, Susanto & Fernald, John G., 2002. "Aggregate productivity and aggregate technology," European Economic Review, Elsevier, vol. 46(6), pages 963-991, June.
    6. Robert Inklaar & Marcel P. Timmer, 2014. "The Relative Price of Services," Review of Income and Wealth, International Association for Research in Income and Wealth, vol. 60(4), pages 727-746, December.
    7. Timmer, Marcel & Ypma, Gerard & van Ark, Bart van, 2007. "PPPs for Industry Output: A New Dataset for International Comparisons," GGDC Research Memorandum GD-82, Groningen Growth and Development Centre, University of Groningen.
    8. Chang-Tai Hsieh & Peter J. Klenow, 2009. "Misallocation and Manufacturing TFP in China and India," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 124(4), pages 1403-1448.
    9. Canyon Bosler & Mary C. Daly & John G. Fernald & Bart Hobijn, 2017. "The Outlook for US Labor-Quality Growth," NBER Chapters, in: Education, Skills, and Technical Change: Implications for Future US GDP Growth, pages 61-110, National Bureau of Economic Research, Inc.
    10. Evsey D. Domar, 1962. "On Total Productivity and All That," Journal of Political Economy, University of Chicago Press, vol. 70(6), pages 597-597.
    11. David M. Byrne & John G. Fernald & Marshall B. Reinsdorf, 2016. "Does the United States Have a Productivity Slowdown or a Measurement Problem?," Brookings Papers on Economic Activity, Economic Studies Program, The Brookings Institution, vol. 47(1 (Spring), pages 109-182.
    12. Francesco Caselli & Wilbur John Coleman II, 2006. "The World Technology Frontier," American Economic Review, American Economic Association, vol. 96(3), pages 499-522, June.
    13. Marcel Timmer & Abdul A. Erumban & Reitze Gouma & Bart Los & Umed Temurshoev & Gaaitzen J. de Vries & I–aki Arto & Valeria Andreoni AurŽlien Genty & Frederik Neuwahl & JosŽ M. Rueda?Cantuche & Joseph , 2012. "The World Input-Output Database (WIOD): Contents, Sources and Methods," IIDE Discussion Papers 20120401, Institue for International and Development Economics.
    14. repec:dgr:rugggd:gd-82 is not listed on IDEAS
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Kevin Hjortshøj O’Rourke, 2021. "Capitalism: Worries of the 1930s for the 2020s," Working Papers 20210064, New York University Abu Dhabi, Department of Social Science, revised Apr 2021.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Harald Fadinger & Christian Ghiglino & Mariya Teteryatnikova, 2022. "Income Differences, Productivity, and Input-Output Networks," American Economic Journal: Macroeconomics, American Economic Association, vol. 14(2), pages 367-415, April.
    2. Fadinger, Harald & Ghiglino, Christian & Teteryatnikova, Mariya, 2015. "Income differences and input-output structure," Working Papers 15-11, University of Mannheim, Department of Economics.
    3. John Fernald & Robert Inklaar & Dimitrije Ruzic, 2025. "The Productivity Slowdown in Advanced Economies: Common Shocks or Common Trends?," Review of Income and Wealth, International Association for Research in Income and Wealth, vol. 71(1), February.
    4. Trenczek, Jan & Wacker, Konstantin M., 2023. "Human Capital Misallocation and Output per Worker Differences: Beyond Cobb-Douglas," GLO Discussion Paper Series 1331, Global Labor Organization (GLO).
    5. Susanto Basu & Luigi Pascali & Fabio Schiantarelli & Luis Serven, 2022. "Productivity and the Welfare of Nations," Journal of the European Economic Association, European Economic Association, vol. 20(4), pages 1647-1682.
    6. Fadinger, Harald & Ghiglino, Christian & Teteryatnikova, Mariya, 2015. "Income differences and input-output structure," Working Papers 15-11, University of Mannheim, Department of Economics.
    7. Ian Goldin & Pantelis Koutroumpis & François Lafond & Julian Winkler, 2024. "Why Is Productivity Slowing Down?," Journal of Economic Literature, American Economic Association, vol. 62(1), pages 196-268, March.
    8. Nicholas Oulton, 2016. "The Mystery of TFP," International Productivity Monitor, Centre for the Study of Living Standards, vol. 31, pages 68-87, Fall.
    9. Jan Trenczek & Konstantin M. Wacker, 2023. "Accounting for cross-country output differences: A sectoral CES perspective," Working Papers 2023.09, International Network for Economic Research - INFER.
    10. Lin Shao & Rongsheng Tang, 2021. "Allocative Efficiency and Aggregate Productivity Growth in Canada and the United States," Staff Working Papers 21-1, Bank of Canada.
    11. Andrew Foerster & Andreas Hornstein & Pierre-Daniel Sarte & Mark W. Watson, 2019. "Aggregate Implications of Changing Sectoral Trends," NBER Working Papers 25867, National Bureau of Economic Research, Inc.
    12. Battisti, Michele & Gatto, Massimo Del & Parmeter, Christopher F., 2022. "Skill-biased technical change and labor market inefficiency," Journal of Economic Dynamics and Control, Elsevier, vol. 139(C).
    13. Alexander Murray, 2017. "What Explains the Post-2004 U.S.Productivity Slowdown?," CSLS Research Reports 2017-05, Centre for the Study of Living Standards.
    14. Gordon, Robert J. & Sayed, Hassan, 2020. "Transatlantic Technologies: The Role of ICT in the Evolution of U.S. and European Productivity Growth," CEPR Discussion Papers 15011, C.E.P.R. Discussion Papers.
    15. Robert J. Gordon & Hassan Sayed, 2019. "The Industry Anatomy of the Transatlantic Productivity Growth Slowdown," NBER Working Papers 25703, National Bureau of Economic Research, Inc.
    16. Costinot, Arnaud & Rodríguez-Clare, Andrés, 2014. "Trade Theory with Numbers: Quantifying the Consequences of Globalization," Handbook of International Economics, in: Gopinath, G. & Helpman, . & Rogoff, K. (ed.), Handbook of International Economics, edition 1, volume 4, chapter 0, pages 197-261, Elsevier.
    17. John G. Fernald, 2015. "Productivity and Potential Output before, during, and after the Great Recession," NBER Macroeconomics Annual, University of Chicago Press, vol. 29(1), pages 1-51.
    18. Hansen, G.D. & Ohanian, L.E., 2016. "Neoclassical Models in Macroeconomics," Handbook of Macroeconomics, in: J. B. Taylor & Harald Uhlig (ed.), Handbook of Macroeconomics, edition 1, volume 2, chapter 0, pages 2043-2130, Elsevier.
    19. Cette, Gilbert & Fernald, John & Mojon, Benoît, 2016. "The pre-Great Recession slowdown in productivity," European Economic Review, Elsevier, vol. 88(C), pages 3-20.
    20. Pena, Werner & Siegel, Christian, 2023. "Routine-biased technical change, structure of employment, and cross-country income differences," CEPR Discussion Papers 18366, C.E.P.R. Discussion Papers.

    More about this item

    JEL classification:

    • E23 - Macroeconomics and Monetary Economics - - Consumption, Saving, Production, Employment, and Investment - - - Production
    • E32 - Macroeconomics and Monetary Economics - - Prices, Business Fluctuations, and Cycles - - - Business Fluctuations; Cycles
    • O30 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - General
    • O47 - Economic Development, Innovation, Technological Change, and Growth - - Economic Growth and Aggregate Productivity - - - Empirical Studies of Economic Growth; Aggregate Productivity; Cross-Country Output Convergence

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:aea:aejmac:v:16:y:2024:i:3:p:160-89. See general information about how to correct material in RePEc.

    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 CitEc recognized a bibliographic reference but did not link an item in RePEc 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 RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Michael P. Albert (email available below). General contact details of provider: https://edirc.repec.org/data/aeaaaea.html .

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

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.