A Retrospective Look at the U.S. Productivity Growth Resurgence

37 Pages Posted: 13 Mar 2007

See all articles by Dale W. Jorgenson

Dale W. Jorgenson

Harvard University - Department of Economics; National Bureau of Economic Research (NBER); Harvard University - Harvard Kennedy School (HKS)

Mun S. Ho

Resources for the Future

Kevin J. Stiroh

Federal Reserve Bank of New York

Date Written: February 2007

Abstract

It is now widely recognized that information technology (IT) was critical to the dramatic acceleration of U.S. labor productivity growth in the mid-1990s. This paper traces the evolution of productivity estimates to document how and when this perception emerged. Early studies concluded that IT was relatively unimportant. It was only after the massive IT investment boom of the late 1990s that this investment and underlying productivity increases in the IT-producing sectors were identified as important sources of growth. Although IT has diminished in significance since the dot-com crash of 2000, we project that private sector productivity growth will average around 2.5 percent per year for the next decade, a pace that is only moderately below the average for the 1995-2005 period.

Keywords: productivity growth, information technology

JEL Classification: O3, O4

Suggested Citation

Jorgenson, Dale W. and Ho, Mun S. and Stiroh, Kevin J., A Retrospective Look at the U.S. Productivity Growth Resurgence (February 2007). FRB of New York Staff Report No. 277. Available at SSRN: https://ssrn.com/abstract=970660 or http://dx.doi.org/10.2139/ssrn.970660

Dale W. Jorgenson

Harvard University - Department of Economics ( email )

Littauer Center
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National Bureau of Economic Research (NBER)

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Harvard University - Harvard Kennedy School (HKS) ( email )

79 John F. Kennedy Street
Cambridge, MA 02138
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Mun S. Ho

Resources for the Future ( email )

1616 P Street, NW
Washington, DC 20036
United States

Kevin J. Stiroh (Contact Author)

Federal Reserve Bank of New York ( email )

33 Liberty Street
New York, NY 10045
United States
(212) 720-6633 (Phone)
(212) 720-8363 (Fax)

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