Download INFORMATION TECHNOLOGY AND U.S. ECONOMIC GROWTH

The Role of Latin America
in the World Economy
By
Dale W. Jorgenson
Harvard University
October 6, 2008
Seminario Internacional
Fundacion BBVA – Ivie 2008
Buenos Aires
http://www.economics.harvard.edu/faculty/jorgenson
Economic Growth in the Information Age
INTRODUCTION:
Prices of Information Technology
ROLE OF INFORMATION TECHNOLOGY:
IT Prices and the Cost of Capital
WORLD GROWTH RESURGENCE:
IT Investment and Productivity Growth
ECONOMICS ON INTERNET TIME:
The New Research Agenda
HOLDING QUALITY CONSTANT
Matched Models and Hedonics
SEMICONDUCTOR PRICE INDEXES:
Memory and Logic Chips.
COMPUTER PRICE INDEXES:
The BEA-IBM Collaboration.
COMMUNICATIONS EQUIPMENT:
Terminal, Switching, and Transmission.
SOFTWARE:
Prepackaged, Custom, and Own-Account.
Relative Prices of Computers and Semiconductors, 1960-2006
All price indexes are divided by the output price index
100,000.0
10,000.0
Log Scale (2000=1)
1,000.0
100.0
10.0
1.0
0.1
0.0
1960
1965
1970
1975
Computers
1980
1985
Memory
1990
1995
Logic
2000
2005
ROLE OF INFORMATION TECHNOLOGY:
IT Prices, Investment, and Productivity.
INPUT SHARES OF IT:
Computers, Communications Equipment, and Software.
CAPITAL CONTRIBUTION:
IT vs. Non-IT Capital Services.
CAPITAL CONTRIBUTION BY TYPE:
Computers, Communications Equipment, and Software.
U.S. Capital Input Contribution of Information Technology
Average annual growth rates, weighted by the income share.
2.50
Annual Contribution (%)
2.00
1.50
1.00
0.50
0.00
1960-1995
1995-2000
Non-IT Capital Services
2000-2006
IT Capital Services
World Capital Input Contribution of Information Technology
Annual percentage growth rates, weighted by income shares
3.00
2.50
1.50
1.00
0.50
0.00
-0.50
World
G7
Developing
Asia
Non-G7
Non-IT Capital
Latin
America
IT Capital
Eastern
Europe
SubSaharan
Africa
1989-1995
1995-2000
2000-2006
1989-1995
1995-2000
2000-2006
1989-1995
1995-2000
2000-2006
1989-1995
1995-2000
2000-2006
1989-1995
1995-2000
2000-2006
1989-1995
1995-2000
2000-2006
1989-1995
1995-2000
2000-2006
-1.00
1989-1995
1995-2000
2000-2006
Annual Contribution (%)
2.00
N. Africa
& M.
East
US
Canada
UK
Non-IT Capital
France
IT Capital
Germany
Italy
2000-2006
1995-2000
1989-1995
2000-2006
1995-2000
1989-1995
2000-2006
1995-2000
1989-1995
2000-2006
1995-2000
1989-1995
2000-2006
1995-2000
1989-1995
2000-2006
1995-2000
1989-1995
2000-2006
1995-2000
1989-1995
Annual Contribution (%)
G7 Capital Input Contribution of Information Technology
Annual percentage growth rates, weighted by income shares
2.50
2.00
1.50
1.00
0.50
0.00
Japan
Argentina
Brazil
Chile
Non-IT Capital
Colombia
IT Capital
Mexico
Peru
2000-2006
1995-2000
1989-1995
2000-2006
1995-2000
1989-1995
2000-2006
1995-2000
1989-1995
2000-2006
1995-2000
1989-1995
2000-2006
1995-2000
1989-1995
2000-2006
1995-2000
1989-1995
2000-2006
1995-2000
1989-1995
Annual Contribution (%)
Capital Input Contribution: Latin America
3.50
3.00
2.50
2.00
1.50
1.00
0.50
0.00
-0.50
Venezuela,
RB
Developing and Transition Economy Contribution of Information Technology
Annual percentage growth rates, weighted by income shares
5.00
3.00
2.00
1.00
0.00
-1.00
Brazil
China
India
Indonesia
Non-IT Capital
Mexico
IT Capital
Russian
Federation
2000-2006
1995-2000
1989-1995
2000-2006
1995-2000
1989-1995
2000-2006
1995-2000
1989-1995
2000-2006
1995-2000
1989-1995
2000-2006
1995-2000
1989-1995
2000-2006
1995-2000
1989-1995
2000-2006
1995-2000
-2.00
1989-1995
Annual Contribution (%)
4.00
South
Korea
WORLD GROWTH RESURGENCE:
IT Investment and Productivity Growth.
TOTAL FACTOR PRODUCTIVITY:
IT-Production versus Non-IT Production.
SOURCES OF ECONOMIC GROWTH:
Capital Input, Labor Input, and TFP.
LABOR INPUT GROWTH:
Hours Worked and Labor Quality.
Sources of U.S. Economic Growth
Average annual growth rates, weighted by the income share.
5.00
4.50
4.00
Annual Contribution (%)
3.50
3.00
2.50
2.00
1.50
1.00
0.50
0.00
1
Labor Hours
2
Labor Quality
Non-IT Capital Services
3
IT Capital Services
TFP
World
G7
Hours
Developing Asia
Quality
Non-G7
Non-IT Capital
Latin America
IT Capital
Eastern Europe
TFP
Sub-Saharan
Africa
2000-2006
1995-2000
1989-1995
2000-2006
1995-2000
1989-1995
2000-2006
1995-2000
1989-1995
2000-2006
1995-2000
1989-1995
2000-2006
1995-2000
1989-1995
2000-2006
1995-2000
1989-1995
2000-2006
1995-2000
1989-1995
2000-2006
1995-2000
1989-1995
Annual Contribution (%)
Sources of World Economic Growth
Annual percentage growth rates
7.00
5.00
3.00
1.00
-1.00
-3.00
-5.00
-7.00
N. Africa &
M. East
US
Canada
Hours
UK
Quality
France
Non-IT Capital
IT Capital
Germany
TFP
Italy
Japan
2000-2006
1995-2000
1989-1995
2000-2006
1995-2000
1989-1995
2000-2006
1995-2000
1989-1995
2000-2006
1995-2000
1989-1995
2000-2006
1995-2000
1989-1995
2000-2006
1995-2000
1989-1995
2000-2006
1995-2000
1989-1995
Annual Contribution (%)
Sources of G7 Economic Growth
Annual percentage growth rates
5.00
4.00
3.00
2.00
1.00
0.00
-1.00
Argentina
Brazil
Hours
Chile
Quality
Colombia
Non-IT Capital
IT Capital
Mexico
TFP
Peru
2000-2006
1995-2000
1989-1995
2000-2006
1995-2000
1989-1995
2000-2006
1995-2000
1989-1995
2000-2006
1995-2000
1989-1995
2000-2006
1995-2000
1989-1995
2000-2006
1995-2000
1989-1995
2000-2006
1995-2000
1989-1995
Annual Contribution (%)
Sources of Growth by Country: Latin America
10.00
8.00
6.00
4.00
2.00
0.00
-2.00
-4.00
Venezuela,
RB
Sources of Growth for Developing and Transition Economies
Annual percentage growth rates
11.00
7.00
5.00
3.00
1.00
-1.00
-3.00
-5.00
-7.00
Brazil
China
India
Hours
Quality
Indonesia
Non-IT Capital
Mexico
IT Capital
Russian
Federation
TFP
2000-2006
1995-2000
1989-1995
2000-2006
1995-2000
1989-1995
2000-2006
1995-2000
1989-1995
2000-2006
1995-2000
1989-1995
2000-2006
1995-2000
1989-1995
2000-2006
1995-2000
1989-1995
2000-2006
1995-2000
-9.00
1989-1995
Annual Contribution (%)
9.00
South Korea
ECONOMIC RESEARCH, OFFICIAL
STATISTICS, AND POLICY ANALYSIS
RESEARCH ON ECONOMIC GROWTH:
Relative Importance of Investment and Productivity
OFFICIAL STATISTICS:
Implementation of a New Architecture for the National Accounts
POLICY ANALYSIS:
Potential Growth in Latin America and the World Economy
World and Major Regions:
Growth Projections, 2006-2016
6.0
5.0
4.0
3.0
2.0
1.0
0.0
World
G7
Developing
Asia
Non-G7
Productivity Growth
Latin America
GDP Growth
Eastern
Europe
GDP per Capita Growth
Sub-Sahara
Africa
N. Africa and
Middle-East
G7: Growth Projections, 2006-2016
4.0
3.0
2.0
1.0
0.0
Canada
France
Germany
Productivity Growth
Italy
GDP Growth
Japan
GDP per Capita Growth
United Kingdom
United States
Major Developing and Transition Economies:
Growth Projections, 2006-2016
9.0
6.0
3.0
0.0
Brazil
China
India
Productivity Growth
Indonesia
GDP Growth
Mexico
GDP per Capita Growth
Russia
South Korea
Latin America: Growth Projections, 2006-2016
4.0
3.0
2.0
1.0
0.0
Argentina
Brazil
Chile
Productivity Growth
Colombia
GDP Growth
Mexico
GDP per Capita Growth
Peru
Venezuela, RB
EU KLEMS PROJECT
CURRENT RELEASE:
March 2008
25 EU ECONOMIES:
Australia, Canada, Japan, Korea, and the U.S.
SOURCES OF DATA:
Capital, Labor, and Intermediate Inputs
COMPLETION DATE:
June 30, 2008