Investment Opportunities to Accelerate Labor Productivity Dynamics

Abstract

The postwar period of economic development in the G7 countries is characterized by diverse dynamics in labor productivity. An important regularity is that labor productivity in most of these countries, lagging substantially behind the United States in the 1950s, closed in on the US level noticeably by the mid- 1990s. In subsequent years, the United States did not surrender its leading positions: the breakaway from the other G7 countries has increased or remained practically unchanged. What conditions, primarily investment ones, bred this phenomenon? Where is the cradle of the mysterious law of uneven development? This article attempts to approach answers to these questions. Attention is paid to growth factors of labor productivity in China, and the special role of the rate of accumulation in this country’s economic growth is stressed. The economic situation here has been exposed to have been acquiring a new quality over the past 15 years. Peak investment costs to increase labor productivity are becoming increasingly more burdensome, which cannot but show on its growth prospects. The G7 countries’ and China’s experience is important for Russia in connection with the discussion on the norm of accumulation and the politics of investment.