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The productivity paradox: evidence from indirect indicators of service sector productivity growth

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  • Edward N. Wolff

Abstract

Whereas difficulties in measuring the output of service sectors have been well documented, input measures are reasonably accurate. Using U.S. input-output data for the period 1958-87 and a number of indices of skill and occupational change derived from the Dictionary of Occupational Titles and decennial census data covering the period 1960-1990, I find strong evidenec that among all industries in the economy industry productivity growth is positively related to R&D intensity and knowledge spillovers from other industries but negatively related to major restructuring of technology.
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Suggested Citation

  • Edward N. Wolff, 1999. "The productivity paradox: evidence from indirect indicators of service sector productivity growth," Canadian Journal of Economics, Canadian Economics Association, vol. 32(2), pages 281-308, April.
    • Handle: RePEc:cje:issued:v:32:y:1999:i:2:p:281-308
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    Cited by:

    1. Alejandro Alcalá-Ordóñez & Francisco Alcalá-Olid & Pablo Juan Cárdenas-García, 2023. "Productivity of Services in the Countries of Central and Eastern Europe: Analysis Using Malmquist Indices," Economies, MDPI, vol. 11(3), pages 1-18, March.
    2. repec:ebl:ecbull:v:6:y:2005:i:3:p:1-9 is not listed on IDEAS
    3. Fontagné, Lionel & Fouré, Jean, 2013. "Opening a Pandora's box: Modeling world trade patterns at the 2035 horizon," WTO Staff Working Papers ERSD-2013-09, World Trade Organization (WTO), Economic Research and Statistics Division.
    4. Duo QIN, 2010. "Is China’s Rising Service Sector Leading to Cost Disease?," EcoMod2004 330600116, EcoMod.
    5. Schettkat, Ronald & Yocarini, Lara, 2006. "The shift to services employment: A review of the literature," Structural Change and Economic Dynamics, Elsevier, vol. 17(2), pages 127-147, June.
    6. Roy Trivedi, Smita, 2011. "The growing dichotomy between real and financial sectors," MPRA Paper 41421, University Library of Munich, Germany.
    7. Andrés Maroto & Luis Rubalcaba, 2008. "Services productivity revisited," The Service Industries Journal, Taylor & Francis Journals, vol. 28(3), pages 337-353, April.
    8. Lionel Fontagné & Jean Fouré, 2021. "Calibrating Long-Term Trade Baselines in General Equilibrium," World Scientific Book Chapters, in: Peter Dixon & Joseph Francois & Dominique van der Mensbrugghe (ed.), POLICY ANALYSIS AND MODELING OF THE GLOBAL ECONOMY A Festschrift Celebrating Thomas Hertel, chapter 4, pages 97-127, World Scientific Publishing Co. Pte. Ltd..
    9. Alan Johnston & Darrell Porter & Trevor Cobbold & Robert Dolamore, 2001. "Productivity in Australia's wholesale and retail trade," Development and Comp Systems 0105003, University Library of Munich, Germany.
    10. Hyunbae Chun, 2007. "The Impact Of Information Technology On Labor Productivity Growth: Evidence From Five OECD Countries, 1970-1990," Korean Economic Review, Korean Economic Association, vol. 23, pages 5-32.
    11. Esther Gordo & Javier Jareño & Alberto Urtasun, 2006. "Radiografía del sector servicios en España," Occasional Papers 0607, Banco de España.
    12. Qin, Duo, 2006. "Is China's growing service sector leading to cost disease?," Structural Change and Economic Dynamics, Elsevier, vol. 17(3), pages 267-287, September.
    13. Jean Chateau & Lionel Fontagné & Jean Fouré & Åsa Johansson & Eduardo Olaberría, 2015. "Trade patterns in the 2060 world economy," OECD Journal: Economic Studies, OECD Publishing, vol. 2015(1), pages 67-100.
    14. Ad van Riet & Moreno Roma, 2006. "Competition, productivity and prices in the euro area services sector," Occasional Paper Series 44, European Central Bank.
    15. Jean Chateau & Erwin Corong & Elisa Lanzi & Caitlyn Carrico & Jean Fouré & David Laborde, 2020. "Characterizing Supply-Side Drivers of Structural Change in the Construction of Economic Baseline Projections," Journal of Global Economic Analysis, Center for Global Trade Analysis, Department of Agricultural Economics, Purdue University, vol. 5(1), pages 109-161, June.
    16. 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.
    17. Pang, Rui-Zhi & Deng, Zhong-Qi & Hu, Jin-li, 2015. "Clean energy use and total-factor efficiencies: An international comparison," Renewable and Sustainable Energy Reviews, Elsevier, vol. 52(C), pages 1158-1171.
    18. Rosalie McLachlan & Colin Clark & Ian Monday, 2002. "Australia's service sector: a study in diversity," Development and Comp Systems 0203002, University Library of Munich, Germany.

    More about this item

    JEL classification:

    • O30 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - General
    • O32 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Management of Technological Innovation and R&D
    • O47 - Economic Development, Innovation, Technological Change, and Growth - - Economic Growth and Aggregate Productivity - - - Empirical Studies of Economic Growth; Aggregate Productivity; Cross-Country Output Convergence
    • O51 - Economic Development, Innovation, Technological Change, and Growth - - Economywide Country Studies - - - U.S.; Canada

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