Download The future_of_productivity_Comment_D_Malliaropulos_April_2016

The Future of Productivity:
Comment
Dimitris Malliaropulos*
Bank of Greece
April 2016
*Chief Economist, Head of Economic Analysis and Research
The distance to the global frontier has widened in
the recession
Source: Giuseppe Nicoletti
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Greece: Rebalancing the economy
Tradable sector gained a higher share in the economy. Change in
relative prices favours rebalancing towards tradable sector
(indices refer to tradable sector relative to non-tradable sector)
Tradables: agriculture, industry, business and financial services, telecommunications and services related to tourism (transport and accommodation and restaurants).
Non-tradables: else except public administartion and non-market services.
Source: Eurostat, Bank of Greece calculations
3
Greece: Potential growth (accounting)
Potential output growth decomposition (average annual growth rates)
1980-2008
2009-2015
2016-2030
1. α*(Δ labor force)*(1-u*)
0,72
0,00
0.10
2. α*Δ capital stock
0,90
-0,40
0.90
3. Δ TFP
0,55
-1,93
1.00
4. Potential growth (1+2+3)
2,18
-2,33
2.00
Potential growth: Δy* = α*Δ labor force*( 1- NAIRU) + (1-α)*Δ Capital stock+ ΔTFP
Source: Bank of Greece estimates
4
Greece: GDP growth accounting
Decomposition of potential growth
5.00
5
4.00
4
3.00
3
2.00
2
1.00
1
-
0
1982 1984 1986 1988 1990 1992 1994 1996 1998 2000 2002 2004 2006 2008 2010 2012 2014
(1.00)
-1
(2.00)
-2
(3.00)
-3
(4.00)
-4
α*Δlabor force*(1-NAIRU)
(1-α)*Δ capital stock
TFP
Potential growth
Source: Eurostat, Ameco, Bank of Greece estimates
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Total Factor Productivity
Average growth 1960-2008 = 1.6% pa
Source: Eurostat, Ameco
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