Data for Productivity Measurement in Market Services: An International Comparison

With market services accounting for an increasing share of GDP as well as for differences in productivity growth performance across countries, the need for accurate measures of services output is becoming ever more important. In this article we first provide an international comparative perspective on the current state of measurement practices in market services across Europe. Second, we discuss the concrete measurement issues and possibilities for improvement in retail trade and banking. Our comparison of European measurement practices shows that improvements are feasible in many countries and industries without the need for fundamental conceptual research: it mostly requires national statistical agencies to devote additional efforts and resources to this objective. This is exemplified in retail trade, where existing data can be used to yield conceptually superior output measures. But there are other industries for which more research is required. Recent progress on the conceptual challenges to measure bank output suggests new data collection efforts would be needed in most countries to improve measurement of output growth in that industry.