GROWTH AND CRISIS IN THE U.S. Growth Resurgence and European Slowdown Economics 1490 GROWTH AND CRISIS IN THE WORLD ECONOMY with Professor Dale W. Jorgenson Lecture 11: October 6, 2016 U.S. Growth Resurgence and European Slowdown Harvard University Department of Economics - Fall 2016
THE WORLD ECONOMY: GROWTH AND CRISIS Lecture 11: October 6, 2016 ]U.S. Growth Resurgence and European Slowdown THE WORLD ECONOMY: GROWTH AND CRISIS Comparing Economies across the World and over Time. 2. The Great Debate over the Financial and Economic Crisis. 3. The European Slowdown and the Crisis in Europe. 4. Asian Economic Miracles: Will They Continue? 5. Sustainability of Economic Growth. 6. World Economic Outlook.
THE EUROPEAN SLOWDOWN AND CRISIS IN EUROPE Lecture 11: October 6, 2016 U.S. Growth Resurgence and European Slowdown THE EUROPEAN SLOWDOWN AND CRISIS IN EUROPE 11. U.S. Growth Resurgence and European Slowdown. 12. European Competitiveness. 13. Europe 2020 and the Single Market. 14. Economic Crisis in Europe. 15. European Policy Response: The Euro. 16. European Policy Response: Brexit
U.S. GROWTH RESURGENCE AND EUROPEAN SLOWDOWN Lecture 11: October 6, 2016 U.S. Growth Resurgence and European Slowdown U.S. GROWTH RESURGENCE AND EUROPEAN SLOWDOWN The U.S. Growth Resurgence after 1995 Was Accompanied by a European Slowdown Europe Converged to the United States until 1995 in Terms of Labor Productivity and Has Subsequently Diverged More Rapid Growth of U.S. Labor Productivity after 1995 Was Due to the Development of the Knowledge Economy The Knowledge Economy Consists of Growth in Labor Quality, IT Capital Intensity, and Total Factor Productivity.
U.S. Growth Resurgence and European Slowdown Lecture 11: October 6, 2016 U.S. Growth Resurgence and European Slowdown MODEL OF PRODUCTION: Production Possibility Frontier. where: I - Investment C – Consumption K – Capital L – Labor A - Total Factor Productivity (TFP)
U.S. Growth Resurgence and European Slowdown Lecture 11: October 6, 2016 U.S. Growth Resurgence and European Slowdown SOURCES OF AVERAGE LABOR PRODUCTIVITY GROWTH where: y = Y/H - Output per Hour Worked (ALP). k = K/H - Capital Input per Hour Worked. CAPITAL DEEPENING: growth of capital input per hour worked, weighted by the share of capital. LABOR QUALITY GROWTH: growth of labor input per hour worked, weighted by the share of labor. TOTAL FACTOR PRODUCTIVITY.
U.S. Growth Resurgence and European Slowdown Lecture 11: October 6, 2016 U.S. Growth Resurgence and European Slowdown Sources of Growth of the World Economy Annual percentage growth rates
U.S. Growth Resurgence and European Slowdown Lecture 11: October 6, 2016 U.S. Growth Resurgence and European Slowdown Annual Contribution (%) Sources of World Economic Growth Annual percentage growth rates
U.S. Growth Resurgence and European Slowdown Lecture 11: October 6, 2016 U.S. Growth Resurgence and European Slowdown Sources of G7 Economic Growth Annual percentage growth rates Annual Contribution (%)
U.S. Growth Resurgence and European Slowdown Lecture 11: October 6, 2016 U.S. Growth Resurgence and European Slowdown Sources of Non-G7 Economic Growth Annual percentage growth rates Annual Contribution (%)
U.S. Growth Resurgence and European Slowdown Lecture 11: October 6, 2016 U.S. Growth Resurgence and European Slowdown
U.S. Growth Resurgence and European Slowdown Lecture 11: October 6, 2016 U.S. Growth Resurgence and European Slowdown
U.S. Growth Resurgence and European Slowdown Lecture 11: October 6, 2016 U.S. Growth Resurgence and European Slowdown
U.S. Growth Resurgence and European Slowdown Lecture 11: October 6, 2016 U.S. Growth Resurgence and European Slowdown THE MARKET ECONOMY Market Economy Excludes Education and Health Services As Well As Government General Administration. Growth of the Knowledge Economy Includes the Following: Contribution of Labor Quality (Labor Composition) Contribution of IT Capital Intensity, Growth of Total Factor Productivity (Multi-Factor Productivity).
U.S. Growth Resurgence and European Slowdown Lecture 11: October 6, 2016 U.S. Growth Resurgence and European Slowdown
U.S. Growth Resurgence and European Slowdown Lecture 11: October 6, 2016 U.S. Growth Resurgence and European Slowdown
U.S. Growth Resurgence and European Slowdown Lecture 11: October 6, 2016 U.S. Growth Resurgence and European Slowdown
U.S. Growth Resurgence and European Slowdown Lecture 11: October 6, 2016 U.S. Growth Resurgence and European Slowdown
THE ROLE OF MARKET SERVICES Lecture 11: October 6, 2016 U.S. Growth Resurgence and European Slowdown THE ROLE OF MARKET SERVICES The Share of Market Services in the GDP Averaged Around 40 Percent in 1995, But Has Been Steadily Growing The Contribution of IT Capital Input in the U.S. Is Higher Than in Europe; the Contribution of Non-IT Capital Input Is About the Same The Share of College-Educated (High-Skilled) Workers in Market Services Is Much Higher in the U.S. than in Europe (Except for Finland) More Rapid Growth of Labor Productivity in U.S. Market Services Is Due To the Contribution of IT Capital and High- Skilled Workers.
U.S. Growth Resurgence and European Slowdown Lecture 11: October 6, 2016 U.S. Growth Resurgence and European Slowdown
U.S. Growth Resurgence and European Slowdown Lecture 11: October 6, 2016 U.S. Growth Resurgence and European Slowdown
U.S. Growth Resurgence and European Slowdown Lecture 11: October 6, 2016 U.S. Growth Resurgence and European Slowdown
U.S. Growth Resurgence and European Slowdown Lecture 11: October 6, 2016 U.S. Growth Resurgence and European Slowdown
U.S. Growth Resurgence and European Slowdown Lecture 11: October 6, 2016 U.S. Growth Resurgence and European Slowdown
U.S. Growth Resurgence and European Slowdown Lecture 11: October 6, 2016 U.S. Growth Resurgence and European Slowdown
U.S. Growth Resurgence and Lecture 11: October 6, 2016 U.S. Growth Resurgence and European Slowdown
U.S. Growth Resurgence and European Slowdown U.S.-EUROPE COMPARISONS Lecture 11: October 6, 2016 U.S. Growth Resurgence and European Slowdown U.S.-EUROPE COMPARISONS FOR THE MARKET ECONOMY The OECD Has Played an Important Role in Establishing Standards for Productivity Measurement: See Schreyer (2001). Growth Accounting for 1995-2010 Using EU KLEMS; the EU KLEMS Data Base Is Available in the EU KLEMS Website: http://www.euklems.net/ The Latest Release Is Through 2012; the Divergence of U.S. and Europe Has Continued up to The Present
U.S. Growth Resurgence and European Slowdown Lecture 11: October 6, 2016 U.S. Growth Resurgence and European Slowdown
U.S. Growth Resurgence and European Slowdown Lecture 11: October 6, 2016 U.S. Growth Resurgence and European Slowdown
U.S. Growth Resurgence and European Slowdown Lecture 11: October 6, 2016 U.S. Growth Resurgence and European Slowdown
U.S. Growth Resurgence and European Slowdown Lecture 11: October 6, 2016 U.S. Growth Resurgence and European Slowdown U.S. GROWTH RESURGENCE AND EUROPEAN SLOWDOWN: SUMMARY European Economic Performance Converged to U.S. Levels through 1995 and Has Since Diverged This is Due to Differences in Productivity Growth in Market Services Which Constitute a Growing Share of Advanced Economies, Averaging About 40 Percent of GDP in 1995 U.S. Has Superior Economic Performance in Market Services Due to Investment in IT and the Growing Participation of High-Skilled Workers This Has Continued up to the Present and Can Be Monitored through the EU KLEMS Data Base