Yeasty investment and mushroom productivity growth: An industry perspective on European and American performance, 1987-2003
Marcel Timmer, Department of Economics, University of Groningen
This paper provides an industry perspective on the sources of labour
productivity growth in France, Germany, Netherlands, the UK and U.S. for the period
1987-2003. U.S. growth has been higher since 1995 because of higher ICT investment
and TFP growth. European labour productivity growth slowed down due to slower
investment in non-ICT assets. Despite these differences, the industry patterns of growth
are similar in both regions. The industry pattern of investment in ICT and non-ICT assets
is balanced or ‘yeasty’ while TFP growth is more localized in a number of industries, a
‘mushroom-like’ pattern. The former finding suggests macroeconomic forces are
important for investment, while the latter phenomenon is still unexplained.
Date: 29 November-00 0000