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Labour or Total Factor Productivity: Do We Need to Choose?

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  • Timothy C. Sargent
  • Edgard R. Rodriguez

Abstract

. In this article, as part of the symposium on total factor productivity, Timothy C. Sargent and Edgard R. Rodriquez of Finance Canada discuss the issue of the choice between labour and total factor productivity. They conclude that both measures have uses. For periods of less than a decade, labour productivity is the preferred measure, but for longer periods total factor productivity is superior. When capital stock estimates are of poor quality, it is better to use labour productivity.

Suggested Citation

  • Timothy C. Sargent & Edgard R. Rodriguez, 2000. "Labour or Total Factor Productivity: Do We Need to Choose?," International Productivity Monitor, Centre for the Study of Living Standards, vol. 1, pages 41-44, Fall.
    • Handle: RePEc:sls:ipmsls:v:1:y:2000:7
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    References listed on IDEAS

    as
    1. D. W. Jorgenson & Z. Griliches, 1967. "The Explanation of Productivity Change," The Review of Economic Studies, Review of Economic Studies Ltd, vol. 34(3), pages 249-283.
    2. Charles R. Hulten, 2000. "Total Factor Productivity: A Short Biography," NBER Working Papers 7471, National Bureau of Economic Research, Inc.
    3. Romer, Paul M, 1987. "Growth Based on Increasing Returns Due to Specialization," American Economic Review, American Economic Association, vol. 77(2), pages 56-62, May.
    4. Greenwood, Jeremy & Hercowitz, Zvi & Krusell, Per, 1997. "Long-Run Implications of Investment-Specific Technological Change," American Economic Review, American Economic Association, vol. 87(3), pages 342-362, June.
    Full references (including those not matched with items on IDEAS)

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    More about this item

    Keywords

    Total Factor Productivity; Labor Productivity; Productivity; Labour; Measurement; Capital Stock; Neoclassical Model; Growth; Data; Comparison; Growth Model;
    All these keywords.

    JEL classification:

    • D24 - Microeconomics - - Production and Organizations - - - Production; Cost; Capital; Capital, Total Factor, and Multifactor Productivity; Capacity
    • O40 - Economic Development, Innovation, Technological Change, and Growth - - Economic Growth and Aggregate Productivity - - - 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
    • O41 - Economic Development, Innovation, Technological Change, and Growth - - Economic Growth and Aggregate Productivity - - - One, Two, and Multisector Growth Models
    • C80 - Mathematical and Quantitative Methods - - Data Collection and Data Estimation Methodology; Computer Programs - - - General
    • E13 - Macroeconomics and Monetary Economics - - General Aggregative Models - - - Neoclassical

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