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Saturday, March 5, 2016

Missing the Juice: What’s Happening with U.S. Productivity Growth?  - Third Way

Missing the Juice: What’s Happening with U.S. Productivity Growth?  - Third Way

TAKEAWAYS

  • Productivity is the key to achieving long-run economic growth and wage gains. It measures how effectively an economy uses a given amount of capital and labor.
  • In general, U.S. productivity gains have slowed in recent decades.
  • There are competing economic theories about why U.S. productivity growth has slowed and whether this shift is permanent.
  • These theories run the gamut from a misallocation of workers to fewer new business starts to flagging public investment to a slowdown in new technology to the rise of income inequality.
  • Each explanation leads to different policy solutions.

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