Information And Communication Technology Growth Research Articles

Britain's Relative Productivity Performance: Has Anything Changed?

This paper summarises the results of a major revision of the data underlying a previous study of Britain's productivity position in an international perspective (O'Mahony, 1999). Thus it examines the productivity record of the UK relative to the US, France, and Germany. There have been a number of changes since the original study which necessitated a revision rather than a mere updating of previous estimates. These included changes to national accounts definitions of value added to include immaterial investments following the adoption of SNA93 by these countries, labour input revisions which allow the distinction between jobs and persons employed, extensive revisions to industrial classifications and the desire to present estimates for unified Germany rather than the former West Germany. In addition the data series were extended to include a division of capital stocks by asset type which allows for a more refined treatment of capital input in explaining relative labour productivity performance. Hence the first aim of this paper is to see if these changes have significantly altered perceptions of Britain's relative productivity position. The evidence on the extent to which Britain has improved its relative productivity position in the past decade is presented and the paper re-examines the issue of the impact of its investment record in both physical and human capital on Britain's labour productivity shortfall. Since the publication of the original study, much of the productivity literature has focused on the new economy and, in particular, the impact of information and communications technology (ICT) on productivity trends. The association between ICT and sector productivity growth rates is also considered below.

The Effects on GDP Growth of ICT: The Case of France Over a Long Period (1980-2000) (In French)

The contribution of information and communication technology (ICT) to GDP growth and labour productivity growth in France is estimated to lie between 0.2 % and 0.3 % per year over the entire 1980-2000 period. According to our estimates, it increased sharply in the second half of the 1990s, in sync with the rise in the contribution of total factor productivity (TFP). The contribution of ICT was twice as strong in the service sector than in industry. Total factor productivity was much higher in the ICT-producing sectors than in those using it. Our estimates show that, in qualitative terms, productivity gains in Europe are close to those in the US, where the quantitative contribution appears nevertheless much stronger.

ICT and Productivity Growth in the United Kingdom

This paper develops new estimates of investment in and output of information and communication technology (ICT). These new estimates imply that GDP growth has been significantly understated, particularly since 1994. A growth‐accounting approach is employed to measure the contribution of ICT to the growth of both aggregate output and aggregate input. On both counts, the contribution of ICT has been rising over time. From 1989 to 1998, ICT output contributed a fifth of overall GDP growth. Since 1989, 55 per cent of capital deepening (the growth of capital per hour worked) has been contributed by ICT capital; since 1994 this proportion has risen to 90 per cent. ICT capital deepening accounts for 25 per cent of the growth of labour productivity over 1989–98 and 48 per cent over 1994–8. But even when output growth is adjusted for the new ICT estimates, both labour productivity and TFP growth are still found to slow down after 1994.

ICT and Productivity Growth in the United Kingdom

This paper develops new estimates of investment in and output of information and communications technology (ICT). These new estimates imply that GDP growth has been significantly understated, particularly since 1994. A growth accounting approach is employed to measure the contribution of ICT to the growth of both aggregate output and aggregate input. On both counts, the contribution of ICT has been rising over time. From 1989 to 1998, ICT output contributed a fifth of overall GDP growth. Since 1989, 55% of capital deepening has been contributed by ICT capital, and 90% since 1994. ICT capital deepening accounts for 25% of the growth of labour productivity over 1989-98 and 48% over 1994-98. But even when output growth is adjusted for the new ICT estimates, both labour productivity and TFP growth are still found to slow after 1994.