Retrospective on the 1970s Productivity Slowdown

46 Pages Posted: 19 Dec 2004 Last revised: 4 Jun 2022

See all articles by William D. Nordhaus

William D. Nordhaus

Yale University - Department of Economics; Cowles Foundation, Yale University; National Bureau of Economic Research (NBER)

Date Written: December 2004

Abstract

The present study analyzes the "productivity slowdown" of the 1970s. The study also develops a new data set -- industrial data available back to 1948 -- as well as a new set of tools for decomposing changes in productivity growth. The major result of this study is that the productivity slowdown of the 1970s has survived three decades of scrutiny, conceptual refinements, and data revisions. The slowdown was primarily centered in those sectors that were most energy-intensive, were hardest hit by the energy shocks of the 1970s, and therefore had large output declines. In a sense, the energy shocks were the earthquake, and the industries with the largest slowdown were near the epicenter of the tectonic shifts in the economy.

Suggested Citation

Nordhaus, William D., Retrospective on the 1970s Productivity Slowdown (December 2004). NBER Working Paper No. w10950, Available at SSRN: https://ssrn.com/abstract=629592

William D. Nordhaus (Contact Author)

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Cowles Foundation, Yale University ( email )

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