The Canada Us Productivity Growth Paradox PDF Download

The gap in labour productivity growth rates is thus not only the result of unusual developments in Canada, as evidenced by the decline in productivity elasticity and below-average productivity growth since 2000, but also largely a consequence of the atypical behaviour of the U. S. economy, as evidenced by its high productivity elasticity since 2000. [...] This growth-accounting exercise suggests that the lacklustre productivity performance of Canada since 2000 relative to the 1973-2000 period cannot be attributed to a single factor, but rather is the result of slower growth in both capital services intensity and MFP, with the latter accounting for the lion's share of the decline. [...] The reallocation growth effect is the sum of the product of the absolute change in the share of hours worked and the absolute change in the labour productivity level for each of the i sectors. [...] The CSLS has calculated the within-sector effect, the reallocation level effect, the reallocation growth effect (also known as the Baumol effect or the interaction effect), the total reallocation effect (the sum of the productivity level and growth effects), and the total sector contribution related to aggregate (business sector) labour productivity growth for 12 sectors for the 1961-2007 period a [...] The churn measure is the sum of the absolute values changes in share of total hours worked or the sum of the absolute values of the reallocation effect.