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Nordic Economic Policy Review

Productivity and competitiveness

image of Nordic Economic Policy Review

The Nordic Economic Policy Review is published by the Nordic Council of Ministers and addresses policy issues in a way that is useful for in-formed non-specialists as well as for professional economists. All articles are commissioned from leading professional economists and are subject to peer review prior to publication. The review appears twice a year. The journal is distributed free of charge to the members of the Nordic economic associations. The easiest way to subscribe to the NEPR is therefore to become a member of one of these associations, i.e., Denmark: Nationaløkonomisk Forening Finland: Taloustieteellinen Yhdistys Norway: Samfunnsøkonomene Sweden: Nationalekonomiska Föreningen. For institutional subscriptions, please contact [email protected] Content: The widening productivity gap between the EU and the US: An introduction to the conference on productivity and competitiveness - Jakob B. Madsen and Anders Sørensen Up the hill and down again: A history of Europe’s productivity gap relative to the United States, 1950-2009 - Bart van Ark Comment by Matti Pohjola Regulation, resource reallocation and productivity growth - Jens Matthias Arnold, Giuseppe Nicoletti and Stefano Scarpetta Comment by Mika Maliranta Human capital and productivity - Angel de la Fuente Comment by Pekka Ilmakunnas Productivity and international firm activities: What do we know? - Joachim Wagner Comment by Markku Stenborg Innovation and productivity - Bronwyn H. Hall Comment by Ari Hyytinen A personnel economics approach to productivity enhancement - Edward P. Lazear and Kathryn L. Shaw Comment by Tuomas Pekkarinen Productivity and education: Benchmarking of elementary and lower secondary schools in Denmark - Peter Bogetoft and Jesper Wittrup Comment by Timo Kuosmanen

English

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Up the hill and down again: A history of Europe's productivity gap relative to the United States, 1950-2009

This paper provides a historical perspective on the American-European productivity paradox since 1995. It reviews the growth and productivity performance in both regions since 1950, and investigates the reasons for the widening of the productivity gap since 1995. Using the EU-KLEMS Growth and Productivity Accounts, the paper shows that the productivity slowdown in Europe is mainly attributable to the slower emergence of the knowledge economy compared to the United States. This is observed in low growth contributions from investment in information and communication technology in Europe, the relatively small share of technologyproducing industries, and slow multifactor productivity growth. The article emphasizes the role of market service sectors in accounting for the productivity growth divergence between the two regions.

English

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