Chapter

Australia's 1990s Productivity Surge and Its Determinants

Dean Parham

in Growth and Productivity in East Asia

Published by University of Chicago Press

Published in print August 2004 | ISBN: 9780226386805
Published online February 2013 | e-ISBN: 9780226387079 | DOI: http://dx.doi.org/10.7208/chicago/9780226387079.003.0003
Australia's 1990s Productivity Surge and Its Determinants

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Australia's growth performance since the early 1990s has been exceptional. After showing its weakest rate in the 1980s, Australia's productivity growth accelerated by a little over 1 percentage point to new highs in the 1990s—labor productivity growth at an average 3.2 percent a year and multifactor productivity growth at 1.8 percent a year. The length and strength of the productivity resurgence—controlling for cyclical influences—demand some “structural” explanations. One such explanation is a shift in the production frontier due to the introduction of new technology—specifically information and communications technologies (ICTs). This chapter examines ICTs as a source of productivity growth in Australia during the 1990s and compares the Australian experience with that of the United States. Productivity growth and the ICT contributions to it are sensitive to cyclical effects. The chapter considers other possible explanations for Australia's growth performance, such as worker education and skills and policy reforms.

Keywords: Australia; productivity growth; multifactor productivity; information and communications technologies; United States; cyclical effects; education; skills; policy reforms

Chapter.  11033 words.  Illustrated.

Subjects: Business and Management

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