21st century progress in computing

In the search for explanations for slower productivity growth since the mid-2000s in many countries, one possibility is a slower pace of progress in digital technologies. In this paper we show that the cost of computation has continued to decline rapidly, taking into account innovation in chip types and cloud computing. This is a continuation of its long-run trend; the decline has slowed since 2010, but not earlier. As firms use computational power along with other inputs including relevant human and organisational capital, to the extent that the productivity slowdown is linked to technology use the explanation is likely to lie in these other elements of the input bundle.