Syverson On The Productivity Slowdown

Chad Syverson has an interesting novel newspaper on the sources of the productivity slowdown.

Background to wake yous up: Long-term U.S.A. increment is slowing down. This is a (the!) big of import number inwards economic science (one previous post).  And productivity -- how much each individual tin orbit per hr -- is the exclusively rootage of long-term growth. We are non vastly amend off than our grandparents because nosotros negotiated amend payoff for hacking at coal amongst pickaxes.

Why is productivity slowing down? Perhaps we've run out of ideas (Gordon). Perhaps a savings glut in addition to the  zero jump drive secular stagnation lack of ask (Summers). Perhaps the out of command regulatory leviathan is killing increment amongst a K cuts (Cochrane).

Or maybe productivity  isn't declining at all, we're merely measuring novel products badly (Varian; Silicon Valley). Google maps is free! If so, nosotros are living amongst undiagnosed but salubrious deflation, in addition to existent gross domestic product increment is genuinely doing well.

Chad:

First, the productivity slowdown has occurred inwards dozens of countries, in addition to its size is unrelated to measures of the countries’ consumption or production intensities of information in addition to communication technologies ... Second, estimates... of the surplus created yesteryear internet-linked digital technologies autumn far brusk of the $2.7 trillion or to a greater extent than of “missing output” resulting from the productivity increment slowdown...Third, if measuring problems were to work concern human relationship for fifty-fifty a small-scale percentage of this missing output, the properly measured output in addition to productivity increment rates of industries that orbit in addition to service ICTs [internet] would accept to accept been multiples of their measured increment inwards the data. Fourth, piece measured gross domestic income has been on average higher than measured gross domestic production since 2004—perhaps indicating workers are beingness paid to brand products that are given away for costless or at highly discounted prices—this tendency genuinely began earlier the productivity slowdown in addition to moreover reflects unusually high upper-case alphabetic lineament income rather than task income (i.e., profits are unusually high). In combination, these complementary facets of bear witness advise that the reasonable prima facie example for the mismeasurement hypothesis faces existent hurdles when confronted amongst the data.

An interesting read throughout. 

[Except for that final sentence, a close parody of academic caution!]  

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