--- Doug Henwood <dhenwood at panix.com> wrote: > jan
carowan wrote:
>
>I have given examples of how and why productivity is
>indeed
>underestimated in the brokerage and banking
industry-->no reply.
This was because I was busy, not because your examples weren't bullshit. You posted:
>>For example, from 73 to 87 while employment only
>doubled in
>the brokerage business, the number of shares trades
>grew from about 6
>million to more than 60 million
What happened to commissions during this period, hein?
The value added by a broker is equal to the commission, and this is measured perfectly well in the GDP numbers. Your chosen measure of productivity would have the effect of making the numbers depend on stock splits.
>While banks have invested heavily in
>computers and ATM machines, banking productivity also
>has been flat in the
>data.
This might be true if banking productivity had been flat in the data. In fact labour productivity in the sector has been rising steadily
>That's because ATM increase for economists the
>measured inputs of
>banks while reducing the output in terms of the
>numbers of checks
>processed.
Who are these "economists"? Not the BLS, which has done vast amounts of work on productivity and IT
http://www.nsf.gov/sbe/srs/seind00/access/c9/c9s2.htm#bank
Not the academics either; the Wharton School has done a massive study on banking productivity.
The published productivity series are the tip of a very. very big iceberg. Their definitions change but slowly, because some people actually use them for proper statistical work, and can't live with constant breaks and rebalancings. In any meaningful policy work, the brute statistics are supplemented with huge amounts of investigation into the flaws in the data, of the very kind I ref'd above. Ever wonder what the huge numbers of economists employed by central banks do all day? That's what they do.
And finally, if you think that the major effect of IT in the banking sector has been to reduce the number of cheques processed, you're wrong.
dd
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