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The Misinterpretation of Productivity Measures

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  • Joaquim Vergés-Jaime

Abstract

The author argues that Sufficient attention has not been paid by economists and statisticians to the fact that, given the way productivity indicators at sector and country-level are defined and determined by statistical agencies, the resulting figures—for comparisons among countries, or among sectors within a country, as well as for comparisons over time (“productivity growth”)—do not actually have the assumed meaning: that is, an increase of the index indicates that the country’s (sector’s) companies have become more productive, in the sense of producing more products or services with the same quantities of resources, or producing the same with fewer quantities of resources, etc.

Suggested Citation

  • Joaquim Vergés-Jaime, 2021. "The Misinterpretation of Productivity Measures," Challenge, Taylor & Francis Journals, vol. 64(2), pages 156-171, March.
    • Handle: RePEc:mes:challe:v:64:y:2021:i:2:p:156-171
    DOI: 10.1080/05775132.2020.1866907
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