Industrialization,Productivity and the Shift to Services and Information

All major world economies are exhibiting a shift from products to services in terms of relative share of GNP and employment. A well accepted explanation for this shift to services has been the lower productivity growth in services relative to manufacturing. A second trend visible in the United States and other advanced economies is that from material‐intensive to information‐intensive sectors with the latter growing relative to the former. There does not seem to be a generally accepted explanation for this shift; in fact, here it would appear that productivity in information‐intensive sectors is increasing. We construct a model of an economy with endogenous production and consumption decisions by utility maximizing individuals. We show that differential productivity changes can result in either relative growth or decline of a sector. A second factor affecting the direction of change is the degree to which consumption of sector outputs approaches satiation. When marginal utility of additional consumption drops sufficiently low, productivity increases can lead to declines in the relative size and share of, and employment in the sector. Concurrently, increases in productivity increase average wealth as expected, but income inequality can either increase or decrease.     

Regional Dispersion of Industrial Labour Costs in the European Community (1988)

ABSTRACT: The aim of this paper is to present a measure of regional labour costs in manufacturing industry in the European Community in 1988. As raw data, derived from the Eurostat Labour Cost Survey, are strongly dependent on sectoral distribution of employment in each region, a method is presented, based on reweighting techniques and loglinear modelling, to eliminate the composition effect. As a result, a regular geographical pattern does emerge. The same type of technique is then applied to the evolution of regional labour costs between 1984 and 1988; some correlation does appear with regional unemployment levels in the United Kingdom and France, pointing the way towards further research.     

An International Comparative Study on Job Mobility

Abstract. Job mobility refers to the movement of people between jobs with different employers. It is an important means of adjustment in the labour market because it facilitates structural changes in the economy. This paper presents the results of a comparative study on job mobility in 6 countries: France, Japan, the Netherlands, Sweden, United Kingdom and the USA. Some of these countries use both labour force surveys and establishment surveys to gather information on job mobility, while other countries only use one of them. The paper uses information from both types of survey held in the seventies and the eighties and describes the developments and the structure of job mobility in the 6 countries. An empirical cross-country analysis shows that job mobility is positively correlated with the growth of employment and negatively correlated with the unemployment rate. There appear to be hardly any structural differences in job mobility between the USA, Sweden, France and the UK. Job mobility in the Netherlands is structurally lower than in the other countries, while job mobility in Japan is structurally lower than in the Netherlands.     

WHICH SECTORS MAKE POOR COUNTRIES SO UNPRODUCTIVE?

Which sectors are most responsible for the low total factor productivities of developing countries? To answer this question we develop a new framework for sectoral development accounting. Applying this framework to the Penn World Table, we find that in equipment, construction, and food the sectoral TFP differences between developing countries and the United States are much larger than in the aggregate. However, in manufactured consumption the sectoral TFP differences are about equal to the aggregate TFP differences, and in services they are much smaller. We show that our level of disaggregation allows us to reconcile the results of existing studies of sectoral productivity differences, which have focused on noncomparable two‐sector decompositions of the aggregate data. We also show that our results help shed light on existing theories of aggregate TFP differences.     

Working women in the European community—The future prospect

EEC regulations direct that as well as equal pay for equal work, women should have equal access to employment. However, obvious distinctions between male and female employment still abound in European countries—though they vary from one country to another—and the difficulties in implementing the legislation are further compounded by the effects of the recession. Business and government will have to plan for the growing demand of women to work and the authors examine the major problems which have to be addressed.     

DOES IDIOSYNCRATIC BUSINESS RISK MATTER FOR GROWTH?

Several imperfections can prevent entrepreneurs from diversifying away the idiosyncratic risk of their business. As a result idiosyncratic risk discourages entrepreneurial activity and hinders growth, with the effects being stronger in economies with lower risk diversification opportunities. In accordance with this prediction, we find that OECD countries with low levels of risk diversification opportunities (as measured by the relevance of family firms or of widely held companies) perform relatively worse (in terms of productivity, investment, and business creation) in sectors characterized by high idiosyncratic risk. Differently from previous literature, we allow risk to be country specific. Since risk is endogenous to risk diversification opportunities, we instrument its value using sectoral risk in the United States, a country where idiosyncratic business risk can be more easily diversified away. Tackling the endogeneity of risk and recognizing that it varies by country magnifies the estimated effects of risk on growth.     

Can the Level of Employment be Explained by GDP Growth in Transition Countries? (Theory versus the Quality of Data)

This paper presents a survey on the relationship between growth and employment in selected transition economies. The second section discusses the empirical evidence using two sets of recent data on employment and pays special attention to gender inequality in economic activity. The third section provides an overview of the literature on the causes of the behaviour of employment and output in transition countries. The fourth section tests the response of employment to GDP growth using data from 11 years and 11 countries. The main result of the paper shows that there seems to be no relationship between output growth and the level of employment in the post‐transition period for two countries: Bulgaria and Ukraine. The fact that both countries have one of the highest shares of unofficial economy in total output in the region is suggested as the main explanation behind this striking result.     

Health care costs tied to many issues

Although, in 1990, the United States spent about $750 billion (12.2 percent of the Gross National Product) on health care, 31-37 million people in this country are uninsured. Another 4 million people are thought to be underinsured. We have one of the highest infant mortality rates among developed industrialized nations and rank 19th in health care and well-being among those nations. Our life expectancy is lower than those of some third-world countries. The United States and South Africa are the only two industrialized nations without a national health care policy. In spite of these statistics, U.S. health care costs continue to rise and, by the year 2000, are expected to reach $1.5 trillion (15 to 17.5 percent of the GNP. Per capita spending on health care will reach $5,515 by the year 2000, compared with $2,425 in 1990 and $1,016 in 1980.     

The influence of retailing trends on the food industry

This article is concerned with retailing trends and the food industry with reference to countries of the EEC, Sweden and the U.S.A. The author examines trends in various sectors of the food market, relating U.S. and European activity and considers the influences of the future growth of mass merchandisers on manufacturers and suppliers.     

Statistics and the Single Market

Abstract. At the end of 1992customs barriers will fall and the European Internal Market will be realized, as envisaged by the Single European Act signed in 1986 by the EEC's member countries. Statistical Offices are preparing to meet the new information requirements from all the economic and social forces of the new Europe. EUROSTAT planned a politically endorsed statistical programme and established the European Statistical Planning Committee, enlarging the tasks of the Conference of the Heads of National Statistical Institutes. Each National Statistical Institute is urgently required to improve the comparability of statistics and implement the harmonised projects of the European Statistical Programme. Official statistics will conform to the new requirements in order to supply the business world, national governments, the EEC authorities and public opinion with up-to-date information to face a wider, more open and competitive market. The business world will focus its attention on information on the flows by sectors and very small areas. Statistics on intra-community foreign trades will shift from customs bills to new tools more directly assigned to national statistical bodies. National governments and EEC countries will need more information on population behaviour as to employment, consumptions, use of leisure time, fruition of public facilities, and social security, as well as more precise estimates of GDP, now the basic contribution to EEC budget. Citizens and public opinion will ask for timely information on migrations, social mobility, income distribution. Demographic projections show the European population is progressively ageing, unemployment is bound to decrease and women are going to be more present within society and the labour market. Information on the home care of elderly people. health, environment, crime prevention and the status of women in general will have to be supplied. Presently Statistics Offices have greater experience in two essential domains: conceptual frameworks and the techniques for conceptual statistical representation of the investigated events. Moreover, the improving of computer technology will provide substantial help to survey methodologies and data processing.     

A Structural Approach to the European Labour Market

The structure of the European labour market is highly differentiated by geo-graphical area. If the 1992 integration is likely to induce short-medium term adjustment effects on employment, these will mostly affect regional labour markets. Negative adjustments will follow different distribution patterns, probably exacerbating current regional disequilibria. On the other hand, still little known are the geographical features of the European economic, social and production structures. Although many studies have recently concentrated on the analysis of local labour markets, few of them have addressed the issue of Community regions. Through multivariate and cluster analyses of structural data on regional labour markets, the paper offers a confirmation of the explanatory power of local market analysis, as applied to the European area. The structural features of each elementary area are captured by three factors only that allow the construction of a coherent classification of EEC regions in four major clusters. This classification is used to identify the “weak areas” that, after a reconsideration in unified terms of European cooperation policies, should be the object of new development interventions.     

Technical Progress,Life of Capital and Employment

This paper examines the hypothesis of a quickening of capital replacement, triggered by the acceleration of technical progress. We present a microeconomic model of replacement processes inspired by the “unbalanced growth” school, highlighting the role of productivity in determining the growth path. The model distinguishes between two types of enterprise, stagnant and progressive, on the basis of productivity trends and shows that prolonged acceleration in the rate of technical progress may be sufficient reason for a rational entrepreneur to make replacements earlier, thus approaching a system of continuous restructuring. We then discuss the main theoretical implications for aggregate employment and the fundamental questions of measurability of the effects. To this end, we undertake an empirical test of aggregate data for the manufacturing sector in four leading economies (the United States, France, Germany, the United Kingdom) from 1970 to 1991. We estimate labour demand functions in which the traditional explanatory variables are supplemented by proxies that capture the effect of a shortening of the life of capital equipment (the replacement rate and the ratio between depreciation and gross fixed capital formation). The empirical evidence confirms the shortening of the average lifetime of capital and is consistent with the main implications of the microeconomic model. The results show, at least indirectly, a negative correlation between an increase in speed of technical progress and the growth of employment.     

The Governance Structure and Performance of Large European Corporations

This article first describes the governance structure ofgroups of large European corporations, viz. the Anglo-Saxon, theGermanic and the Latinic types of firms. It then discussesperformance criteria of which four are used: productivity or netvalue added per employee, growth, employment and total compensationto shareholders. It is found that Continental corporations have aperformance which is equal to or better than that of the Anglo-Saxongroup. Combining the structural and performance outcomes, theexplanation seems to be that the dominance of capital markets andthe market for corporate control force Anglo-Saxon managements tomaximize returns on capital, whereas Continental firms have a widerrange of options.     

ICT服务业资本存量及其产出弹性估算研究

21世纪以来,ICT发展已经深刻地影响着中国经济社会。为检验中国ICT资本是否存在"生产率悖论",本文运用PIM系统估算了2003-2016年期间全国层面和地区层面ICT服务业和非ICT服务业资本存量及其产出弹性。研究发现,中国ICT服务业存在明显的"投资不足",但在2012年以后有所缓和;ICT服务业资本存量在各地区表现非均衡分布,但其差距趋于收敛;ICT服务业资本对中国经济增长具有显著的促进作用,产出弹性在0.1605-0.1705之间;从时间趋势来看,考察期间内ICT服务业资本对中国经济增长的影响效果不断增强,从区域差异来看,ICT服务业资本产出弹性在东、中和西部呈依次递减趋势。本文研究证实中国ICT资本不存在"生产率悖论"。     

Sectoral Employment Shifts and Unemployment

ABSTRACT: This paper provides additional insight on the Lilien 1982 sectoral shift hypothesis (Lilien (1983),Abraham and Katz (1986),Samson (1986),Neelin (1987)) by applying it to Swedish data.Lilien claimed that part of the cyclical variation in unemployment is caused by structural shifts in sectoral employment demand. We find some evidence in favour of Lilien‘s notion. Greater sectoral shocks partly result in higher unemployment in Sweden. When extending the sectoral shift approach, controlling for labour market support, the evidence in favour of the sectoral shift hypothesis is weaker.     

Productivity Competitiveness among Non Cooperating Integrated Economies: A Negative-Sum Game

ABSTRACT: The strategies adopted by European countries during the 1970‘s and 1980‘s have been unsuccessful in their attempt to produce more employment. These strategies have been centred on attempts to improve the international position of a country at the expense of the others through increasing productivity and competitiveness. The negative effects on employment due to higher productivity should have been offset, in the longer run, by an increasing share of exports. But the eventual result has been that relative positions of countries have remained fundamentally unchanged. This is due to the fact that all countries adopted the same strategy. Aggressive strategies do not pay in terms of employment. More effective policies, in a situation characterized by accelerated technical progress, can be more easily implemented in a more co-operative international context. Even if there is no moral solidarity between the nearly related races of Europe, there is an economic solidarity which we cannot disregard. Even now the world markets are one. This is to put the issue on its lowest grounds. There are other arguments, which the most obtuse cannot ignore, against a policy of spreading and encouraging further the economic ruin of great countries (J.M. Keynes) ¹⁸     

Micro-Flexibility and Macro-Rigidity: Some Notes on Expectations and the Dynamics of Aggregate Supply

ABSTRACT: The high macro supply elasticity experienced by industrialised countries during the second post-war boom is not explainable as the aggregate effect of current variations of companies’output in response to current variations of demand. A firm cannot adapt rapidly its output to higher demand unless it has decided fairly in advance to expand its productive capacity. Macro elasticity depends thus on the existence of ex ante excess capacity, built on the basis of expectations. The post-war boom is thus explained in terms of a virtuous sequence expectations-decisions-events. This approach helps in understanding the inversion of the expansionary phase to one of stag-flation, the failure of Keynesian policies and the subsequent industrial restructuring which gave rise to the present employment squeeze. Flexibility is something which depends on the relationships between individual expectations and decisions and their systemic results; the presently pursued micro-flexibility is at high risk of producing increasing macro-rigidity.     

Manpower requirements of scientists and engineers in high technology industries

This paper analyzes the impact on job requirements for engineers, scientists, technicians and skilled workers of the output of high technology and research intensive industries. The manpower requirements for 22 occupations resulting from a billion dollars of output of each of 12 industries are estimated for 1983. The manpower impacts of the total output of each industry are then simulated to determine the importance of economic activity in these industries in creating employment within each occupation in 1983. Occupational manpower requirements generated by the industries' 1983 outputs are analyzed in relation to total industry output and employment and total employment within each occupation. It is found that the industries analyzed here, although accounting for only 19% of GNP, are responsible for creating between 25% and 60% of many science, engineering and related jobs. These results are detailed for each industry and for every occupation, and the direct and the indirect manpower requirements for each occupation are computed. The implications of these findings are briefly discussed.     

The Impact of Uncertainty Shocks

Uncertainty appears to jump up after major shocks like the Cuban Missile crisis, the assassination of JFK, the OPEC I oil‐price shock, and the 9/11 terrorist attacks. This paper offers a structural framework to analyze the impact of these uncertainty shocks. I build a model with a time‐varying second moment, which is numerically solved and estimated using firm‐level data. The parameterized model is then used to simulate a macro uncertainty shock, which produces a rapid drop and rebound in aggregate output and employment. This occurs because higher uncertainty causes firms to temporarily pause their investment and hiring. Productivity growth also falls because this pause in activity freezes reallocation across units. In the medium term the increased volatility from the shock induces an overshoot in output, employment, and productivity. Thus, uncertainty shocks generate short sharp recessions and recoveries. This simulated impact of an uncertainty shock is compared to vector autoregression estimations on actual data, showing a good match in both magnitude and timing. The paper also jointly estimates labor and capital adjustment costs (both convex and nonconvex). Ignoring capital adjustment costs is shown to lead to substantial bias, while ignoring labor adjustment costs does not.