Productivity Growth and Levels in France, Japan, the United Kingdom and the United States in the Twentieth Century

45 Pages Posted: 2 Jun 2010

See all articles by Gilbert Cette

Gilbert Cette

Banque de France

Yusuf Kocoglu

University of Toulon-Var

Jacques Mairesse

National Institute of Statistics and Economic Studies (INSEE) - Center for Research in Economics and Statistics (CREST); Maastricht University - United Nations and Maastricht Economic Research Institute on Innovation and Technology (UNU-MERIT); National Bureau of Economic Research (NBER)

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Date Written: January 1, 2010

Abstract

This study compares labor and total factor productivity (TFP) in France, Japan, the United Kingdom and the United States in the very long (since 1890) and medium (since 1980) runs. During the past century, the United States has overtaken the United Kingdom and become the leading world economy. During the past 25 years, the four countries have also experienced contrasting advances in productivity, in particular as a result of unequal investment in information and communication technology (ICT). The past 120 years have been characterized by: (i) rapid economic growth and large productivity gains in all four countries; (ii) a long decline in productivity in the United Kingdom relative to the United States, and to a lesser extent also relative to France and Japan, a relative decline that was interrupted by the second world war (WW2); (iii) the remarkable catching-up to the United States by France and Japan after WW2, interrupted in the case of Japan during the 1990s. Capital deepening (at least to the extent this can be measured) accounts for a large share of the variations in performance; increasingly during the past 25 years, this has meant ICT capital deepening. However, the capital contribution to growth varies considerably over time and across the four countries, and it is always less important, except in Japan, than the contribution of the various other factors underlying TFP growth, such as, among others, labor skills, technical and organizational changes and knowledge spillovers. Most recently (in 2006), before the current financial world crisis, hourly labor productivity levels were slightly higher in France than in the United States, and noticeably lower in the United Kingdom (by roughly 10%) and even lower in Japan (30%), while TFP levels are very close in France, the United Kingdom and the United States, but much lower (40%) in Japan.

Keywords: Productivity, Growth Accounting, Macro-Economic History

JEL Classification: O47, O57, E22, J24, N10

Suggested Citation

Cette, Gilbert and Kocoglu, Yusuf and Mairesse, Jacques, Productivity Growth and Levels in France, Japan, the United Kingdom and the United States in the Twentieth Century (January 1, 2010). Banque de France Working Paper No. 271. Available at SSRN: https://ssrn.com/abstract=1619305 or http://dx.doi.org/10.2139/ssrn.1619305

Gilbert Cette (Contact Author)

Banque de France ( email )

Paris
France

Yusuf Kocoglu

University of Toulon-Var ( email )

Avenue de l'Université
La Garde
France

Jacques Mairesse

National Institute of Statistics and Economic Studies (INSEE) - Center for Research in Economics and Statistics (CREST) ( email )

15 Boulevard Gabriel Peri
Malakoff Cedex, 1 92245
France

Maastricht University - United Nations and Maastricht Economic Research Institute on Innovation and Technology (UNU-MERIT)

Keizer Karelplein 19
6211 TC Maastricht
Netherlands

National Bureau of Economic Research (NBER)

1050 Massachusetts Avenue
Cambridge, MA 02138
United States

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