Contemporary Labor Economics iona现代劳动经济学 Iona.pptVIP

* * 6. The “New Economy” Use of Information Capital Increased use of information capital Faster increases in the quantity of information such as computers may have increased productivity growth. Jorgenson, Ho, and Strohs analysis indicates 37 percent of the productivity growth between 1995-2000 was due to increases in the use of information technology. The corresponding figure for 2000-2006 was 23 percent. * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * 17-* Copyright ? 2010 by the McGraw-Hill Companies, Inc. All rights reserved. McGraw-Hill/Irwin Chapter 17 Labor Productivity: Wages, Prices, and Employment 1. The Productivity Concept Labor Productivity Labor Productivity = Total product (real GDP) Number of worker hours Productivity IndexYear 2 = ProductivityYear 2 ProductivityBase Year * 100 Productivity can be calculated using data from different years to form an index of productivity relative to a base year. BLS Index The BLS productivity index is calculated by dividing real output in the private sector by the number of hours employed in the private sector. The index understates productivity growth in that improvements in the quality of output are not taken into account. The index implies that labor alone is the cause of the rise in productivity. Other factors such as increases in the amount of capital and technological progress also play a role. 2. Importance of Productivity Increases Importance of Productivity Increases Productivity increases are important because: Productivity growth is the basic source of increases in real wages and living standards. Productivity growth is an anti-inflationary force in that it offsets increases in nominal wages. Productivity and Real Compensation Because real output is real income, the growth of real output per worker hour and the growth of real compensation per hour are very closely related. Productivity change in the nonfarm business s