Allocative efficiency and aggregate productivity growth in Canada and the United States / by Lin Shao and Rongsheng Tang.: FB3-5/2021-1E-PDF
"This paper evaluates the contribution of allocative efficiency to the aggregate productivity growth in Canada and the US. In particular, we are interested in explaining two puzzling facts: 1) the slowdown in productivity growth during the 1970s and the 2000s in the US, and 2) the widening Canada-US productivity gap since the middle of the 1980s. We extend the framework of Oberfield (2013) to derive sufficient statistics for allocative efficiency and decompose aggregate productivity in an input-output economy à la Jones (2013). The lack of improvement in allocative efficiency can explain two-thirds of the US’s productivity slow down and more than one-third of the widening Canada-US productivity gap. The allocation of capital, rather than labor, was the main driver behind the overall movement in allocative efficiency. Resources allocated to service sectors were significantly lower than the optimal level. It improved markedly over time, especially in the US before the 2000s"--Abstract.
Permanent link to this Catalogue record:
publications.gc.ca/pub?id=9.895184&sl=0
| Department/Agency | Bank of Canada, issuing body. |
|---|---|
| Title | Allocative efficiency and aggregate productivity growth in Canada and the United States / by Lin Shao and Rongsheng Tang. |
| Series title | Staff working paper = Document de travail du personnel, 1701-9397 ; 2021-1 |
| Publication type | Series - View Master Record |
| Language | [English] |
| Format | Electronic |
| Electronic document | |
| Note(s) | "Last updated: January 7, 2021." Includes bibliographical references (pages 35-36). |
| Publishing information | Ottawa, Ontario, Canada : Bank of Canada = Banque du Canada, 2021. ©2021 |
| Author / Contributor | Shao, Lin, author. |
| Description | 1 online resource (ii, 53 pages) : charts. |
| Catalogue number |
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| Subject terms | Industrial productivity -- Canada -- Econometric models. Industrial productivity -- United States -- Econometric models. Productivité -- Canada -- Modèles économétriques. Productivité -- États-Unis -- Modèles économétriques. |