Chapter

Total Factor Productivity

R. C. O. Matthews, C. H. Feinstein and J. C. Odling‐Smee

in British Economic Growth 1856-1973

Published in print October 1982 | ISBN: 9780198284536
Published online November 2003 | e-ISBN: 9780191596629 | DOI: http://dx.doi.org/10.1093/0198284535.003.0007

Series: Studies of Economic Growth in Industrialized Countries

 Total Factor Productivity

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The rates of growth of total factor input (TFI) and total factor productivity (TFP) are the “sources” of output growth only in a proximate sense. Despite their imperfections, these concepts remain a convenient category for study, provided that their limitations are recognized. If labour input is measured in man‐hours, TFP appears as a more important source of growth than TFI, averaged over the period 1856–1973 as a whole. If labour input is measured with allowance for estimated quality change, this conclusion is reversed. On any reckoning, the rate of growth of TFI was lower in the post‐war period than in all earlier peacetime periods, and the rate of growth of TFP much higher. There was a decline in the rate of growth of TFP, after allowance for labour quality change, between each period up to and including 1913–24, and a rise between each period after that.

Keywords: Total factor input growth; Total factor productivity growth

Chapter.  6924 words.  Illustrated.

Subjects: Economic History

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