R&D, Education, and Productivity: A Retrospective. By Zvi Griliches. Cambridge, MA: Harvard University Press, 2000. Pp. ix, 127. $39.95.

Abstract

Until his untimely death Zvi Griliches was an important contributor to the measurement and interpretation of productivity growth in the United States and elsewhere. Economists working in this area have been principally concerned with trends in two key measures of productivity: labor productivity, or output per hour, and multifactor or total factor productivity (MFP). Growth in labor productivity is the growth in real output less growth in hours, and multifactor productivity growth is the growth in real output less a weighted average of growth of inputs conventionally measured, with the weights corresponding to shares of factors in national income. The former measure is the most important determinant of growth in our material standard of living as measured by growth in per capita real output. The latter variable, subject to some qualifications, gives us some measure of the impact on economic growth of scientific and technical progress in different periods. The two are closely related, since growth in labor productivity can be decomposed into a portion accounted for by capital deepening (rise in the ratio of capital services per labor hour) and the “residual” contributed by growth in MFP.