Lessons from a Career in Productivity Research: Some Answers, A Glimpse of the Future, and Much Left

Why did United States in the early 1970s, a slow- productivity growth revive in the United down that also took place in the other ad- States 1995-2004 and then slow again af- vanced economies? ter that? There is a consensus that this An especially puzzling feature of the was the result of the surge in investment in slowdown in productivity growth in the computers and other technology, together ear. [...] The methodology is explained on aggregate measures of productivity and in the productivity handbook written by while the study of productivity at this the OECD.11 level is valuable, we know that the econ- The results of the decomposition of TFP omy is made up of thousands of companies growth by industry for the business sector that are grouped into many different in- of the U. [...] Evsey Domar showed how haps the most striking result is the very to measure the contribution of TFP growth large contribution from the manufacturing in each industry to the overall growth of the sector. [...] That is not to min- estimate the contribution of, say, manufac- imize the importance of the other indus- turing to TFP growth in the business seg- tries, but to note the surprising role of man- ment of the economy, or the contribution of ufacturing given its modest size in the U. [...] Utiliza- assigned, and the layout of the premises tion of labour is much better in residential and the design of the equipment allows construction in the United States.20 high productivity.