|Home > News and Events > News|
Will the U.S. Productivity Resurgence Continue?
|December 13 , 2004|
|Note To Editors||
The latest edition of the Federal Reserve Bank of New York’s Current Issues in Economics and Finance, Will the U.S. Productivity Resurgence Continue? is available.
Authors Dale W. Jorgenson, Mun S. Ho, and Kevin J. Stiroh update their analysis of U.S. productivity growth with recent data and conclude that private sector productivity will grow at a rate of 2.6 percent per year for the next decade, a significant increase from their 2002 projection of 2.2 percent.
Despite a series of negative shocks that began
with the bursting of the NASDAQ bubble in 2000
and continued through the current spike in energy
prices, productivity growth has remained strong
and even accelerated in recent years. From 1995
through the second quarter of 2004, productivity
grew at a rate of 3.1 percent per year, more than
twice the average rate of the previous two decades.
The authors also note that the future of productivity growth depends critically on factors such as the evolution of semiconductor technology and the composition of business investment, which are difficult to predict. Nonetheless, they maintain there is little evidence to suggest that the technology-led productivity resurgence is over or that the U.S. economy will revert to the slower pace of productivity growth observed in the 1970s and 1980s.
Dale W. Jorgenson is the Samuel W. Morris University
Professor at Harvard University; Mun S. Ho is a
visiting scholar at Resources for the Future, an
independent research institute in Washington, D.C.;
Kevin J. Stiroh is an assistant vice president
in the Banking Studies Function of the Bank’s
Research and Statistics Group.