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Comments on Robert Gordon and Joel Mokyr “The long-term future of productivity? The state of the debate”, Jonathan Haskel

Presentation by Jonathan Haskel, "Comments on Robert Gordon and Joel Mokyr “The long-term future of productivity? The state of the debate”"

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Comments on Robert Gordon and Joel Mokyr “The long-term future of productivity? The state of the debate”, Jonathan Haskel

  1. 1. Comments on Robert Gordon and Joel Mokyr “The long-term future of productivity? The state of the debate” Jonathan Haskel Imperial College Business School, CEPR, IZA Joint OECD-NBER Conference on Productivity Growth and Innovation in the Long Run, OECD Paris, 25-26 September 2014
  2. 2. Productivity growth: a case study •http://youtu.be/RRy_73ivcms
  3. 3. Productivity growth •How to think about productivity growth in this process –Measurement: four wheels are changed, but have to adjust for quality (here, speed). Lessons for ICT, including C (Corrado, 2011), service sector productivity –Capital deepening: not just the compressed air spanners, but also ICT –Labour quality: education of the team –TFP/knowledge/intangible capital deepening: Teamwork •How to think about productivity growth in this industry –Highly capital intensive (tangible and intangible), complementary to ICT via TV rights. –Car racing tastes crosses cultural boundaries –Globalisation & cheap communications => scale => increased earnings for scarce factors (drivers, owners of rights) => inequality Haskel, Lawrence, Leamer, Slaughter (2013) •Productivity in other industries –Spillovers into health
  4. 4. Headwinds? •RJG: •So: three elements to RJG story –So output per person can be slowed by slowdown in •productivity (labour quality, capital deepening, technical change) •Lab force participation (women, part-time work, sickness, discouraged workers) –and then consumption depends on incomes net of debt repayments, which in turn depends upon •inequality => might be no income rise for most of population, and a no rise in consumption •Debt => less scope for consumption •The three elements –Productivity –Labour force participation –Inequality/debt productivitylabour force participation, working hoursoutput output hours worked personhour workedperson 
  5. 5. Headwinds? •Can we see some of Bob’s concerns in this 1950s picture? The US economy in 1950 –Inequality/debt –Labour force participation •Low unemployment/discouraged worker, female participation •Income inequality and debt would be less: so consumption would grow •Young workforce with high participation –Productivity •Labour quality to improve: graduation from high school/ college? •ICT revolution to come
  6. 6. Some remarks •RJG US slowdown is from 2%pa to 0.5%pa. –Due to debt/inequality = 0.7%pa –Due to labour quality & demography= 0.2%pa and 0.3%pa –Due to technical change (includes post 72 slowdown =0.6%) •Inequality debt –Applies to other countries? –Scope for other countries to catch up to US •Labour quality slowing –Long term unemployed/discouraged workers: scope for policy? –Quality of education/graduation rates •Scope for policy: Fryer/Angrist/Lavy on incentives? •Long-term technical progress –Has the ICT revolution played out? •schools and higher education? •Is Moore’s law slowing? Byrne, Oliner, Sichel, 2014 •Gains in ICT as capital deepening/TFP in the discovery process –Hayekian uncertainty •Syverson , 2013 –Is the IP system fit for purpose?
  7. 7. Is the price decline of microprocessors slowing? Source: Byrne, Oliner, Sichel, 2014
  8. 8. General purpose technologies and productivity Source: Syverson , 2013
  9. 9. Source: WSJ, June 2014, Economists Debate and RJG

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