Agreed. But overestimates in productivity growth in services that are purchased by businesses and not sold to consumers induce offsetting underestimates in productivity growth in industries that produce goods and services that are actually part of final demand.
>What does is mean, and, more importantly, how is it distributed?
Oh, distribution is lousy and is getting a lot worse fast. No argument from me on that.
>It's missing the 41m+ with no health insurance, isn't it? As Roach
>points out, the latest productivity stats, unlike those of the late
>1990s, show much stronger growth in the service- than
>goods-producing sector. Ok, what service sectors are contributing?
>Retail maybe? That would mean Wal-Mart, which is miracle of
>uncompensated labor, from the pants-folder in Texas (paid minimally,
>discriminated against for her sex, and often forced to work off the
>clock)
A *very* different argument from Roach's, you will notice. The argument that the productivity gains are not social welfare gains because they are the result of speed-up might be true. But it's not what Roach is talking about.
And it does face the problem that the unemployment rate now is lower than at any time from 1980 to 1993: how is Wal-Mart accomplishing so much extra speedup now when its analogues could not do so then?
>to the seamstress in Asia (paid minimally, discrimianted against for
>her sex, and often forced to work off the clock).
>What other services? Not finance, as even Jorgenson and Stiroh
>conceded, if my memory is serving me. How do you measure the real
>output of the financial sectory anyway?
God knows. Maybe it's like the gambling sector: value-added in gambling is how much the casinos fleece from the marks, after all.
>Health care? Ha.
Actually, yes. Remarkable things are happening in treatments for a bunch of different diseases. Why, the difference claritin has made for my daughter...
>Really - where is this 8 or 9% growth in service sector productivity
>happening? In the 90s, the star of the productivity revo was durable
>manufacturing, particularly computers themselves - an artifact
>mainly of hedonic pricing.
"Artifact" is the wrong word. There are big questions about how much value/utility I get (or an organization gets) our of my (or their) new laptops which have 16 times the cpu throughput, 32 times the memory, and 100 times the hard disk space of my laptop a decade ago--and which weighs have as much, and which costs half as much in nominal dollars. But to say that each is a "computer" is surely much more of an artifact than is the hedonics.
>Is that miracle now eclipsed by an unspecified miracle in services?
>
>By the way, a BLS guy told me that outsourcing is mainly a wash for
>the productivity stats. If the value is added outside the U.S., it
>doesn't enter into the numerator (output) - and of course it doesn't
>enter into the denominator (labor inputs) either.
>
>I think the miraculous aspect of the recession and its aftermath has
>largely been people working longer hours without them getting
>accounted for. The hours worked input to the productivity stats
>measures hours paid for, not hours put in on the job. Which is a
>great deal for employers, but it's really not what we're hoping for
>when we talk about productivity improvements.
Possible. But I haven't seen much evidence that higher service-sector relative surplus value is driving the productivity statistics. It's a hypothesis...
Brad DeLong