Productivity, Computerization, and Skill Change

Using pooled cross-section, time-series data for 44 industries over the decades of the 1960s, 1970s, and 1980s in the United States, I find no econometric evidence that computer investment is positively linked to TFP growth (over and above its inclusion in the TFP measure). However, computerization is positively associated with occupational restructuring and changes in the composition of intermediate inputs and capital coefficients. There is modest evidence that the growth of worker skills is positively related to industry productivity growth. The effects are very modest -- adding at most 0.07 percentage points to annual labor productivity growth.

[1]  Edward N. Wolff,et al.  Outsourcing of Services and the Productivity Recovery in U.S. Manufacturing in the 1980s and 1990s , 2001 .

[2]  Zvi Griliches,et al.  R&D and the Productivity Slowdown , 1980 .

[3]  E. F. Denison,et al.  Accounting for Slower Economic Growth : The United States in the 1970s , 1979 .

[4]  D. Jorgenson,et al.  Raising the Speed Limit: U.S. Economic Growth in the Information Age , 2000 .

[5]  Zvi Griliches,et al.  Notes on the Role of Education in Production Functions and Growth Accounting , 1970 .

[6]  M. Baily,et al.  The Productivity Slowdown, Measurement Issues, and the Explosion of Computer Power , 1989 .

[7]  D. Jorgenson,et al.  Information Technology and Growth , 1999 .

[8]  R. C. O. Matthews,et al.  Accounting for Slower Economic Growth: The United States in the 1970s. , 1981 .

[9]  E. F. Denison.  The Interruption of Productivity Growth in the United States , 1983 .

[10]  K. Arrow.  Higher education as a filter , 1973 .

[11]  Zvi Griliches,et al.  Purchased Services, Outsourcing, Computers, and Productivity in Manufacturing , 1991 .

[12]  William Lehr,et al.  Computer Use and Productivity Growth in federal Government Agencies , 1996 .

[13]  E. Wolff.  Productivity Growth, Capital Intensity, and Skill Levels, in the U. S. Insurance Industry, 1948–86 , 1991 .

[14]  A. Maddison,et al.  Phases of capitalist development , 1983 .

[15]  B. Lundvall.  OECD's publikation: Technology and Productivity: the Challenge for Economic Policy , 1991 .

[16]  Edward N. Wolff,et al.  Human capital investment and economic growth: Exploring the cross-country evidence , 2000 .

[17]  Stephen D. Oliner,et al.  The Resurgence of Growth in the Late 1990s: Is Information Technology the Story? , 2000 .

[18]  C. Gotlieb,et al.  Productivity and computers in Canadian banking , 1993 .

[19]  P. Mohnen.  The relationship between R&D and productivity growth in Canada and other major industrialized countries , 1992 .

[20]  Edwin Mansfield,et al.  Basic Research and Productivity Increase in Manufacturing , 1980 .

[21]  Charles Steindel,et al.  Manufacturing productivity and high-tech investment , 1992 .

[22]  D. Siegel.  The Impact of Computers on Manufacturing Productivity Growth: A Multiple-Indicators, Multiple-Causes Approach , 1997, Review of Economics and Statistics.

[23]  J. Mincer.  Schooling, Experience, and Earnings , 1976 .

[24]  Edward N. Wolff,et al.  Productivity and American Leadership: The Long View , 1989 .

[25]  E. Berndt,et al.  High-tech capital formation and economic performance in U.S. manufacturing industries : an exploratory analysis , 1992 .

[26]  Edward N. Wolff,et al.  Technology and the Demand for Skills , 1995 .

[27]  D. Jorgenson,et al.  Education and productivity growth in a market economy , 1993 .

[28]  M. Spence.  Job Market Signaling , 1973 .

[29]  Atreya Chakraborty,et al.  Product Differentiation and the Use of Information Technology : New Evidence from the Trucking Industry , 1999 .

[30]  Theodore W. Schultz,et al.  Capital Formation by Education , 1960, Journal of Political Economy.

[31]  Paul A. David,et al.  COMPUTER AND DYNAMO: The Modern Productivity Paradox in a Not-Too Distant Mirror , 1989 .

[32]  Zvi Griliches,et al.  Issues in Assessing the Contribution of Research and Development to Productivity Growth , 1979 .

[33]  Stephen D. Oliner,et al.  Computers and Output Growth Revisited: How Big Is the Puzzle? , 1994 .

[34]  E. F. Denison,et al.  Accounting for Slower Economic Growth , 1979 .

[35]  Richard H. Franke.  Technological revolution and productivity decline: the case of US banks , 1989 .

[36]  Kevin J. Stiroh,et al.  Computers, Productivity, and Input Substitution , 1998 .

[37]  Z. Griliches.  The Search for R&D Spillovers , 1991 .

[38]  K. Stiroh,et al.  Are ICT Spillovers Driving the New Economy? , 2002 .