Document Type

Discussion Paper

Publication Date

11-1-2004

CFDP Number

1494

CFDP Pages

30

Abstract

The present study reviews the “productivity slowdown” of the 1970s and 1980s. The study also develops a new data set — industrial data available back to 1948 — as well as a new set of tools for decomposing changes in productivity growth. The major result of this study is that the productivity slowdown of the 1970s has survived three decades of scrutiny, conceptual refinements, and data revisions. The slowdown was primarily centered in those sectors that were most energy-intensive, were hardest hit by the energy shocks of the 1970s, and therefore had large output declines. In a sense, the energy shocks were the earthquake, and the industries with the largest slowdown were near the epicenter of the tectonic shifts in the economy.

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