Economic models vs techno-optimism: Predicting medium-term total factor productivity rates in the US
Economic models vs ‘techno-optimism’: Predicting medium-term total factor productivity rates in the US
background briefing series,economic history,policy briefing
Nicholas Crafts, Terence Mills, The CAGE Background Briefing Series No. 68, September 2017
Estimates of trend total factor productivity growth in the US have been significantly reduced, contributing to fears that the slowdown is permanent. This column provides an historical perspective on the relationship between estimated trends in total factor productivity growth and subsequent outcomes. It argues that In the past, trend growth estimates have not been a good guide for future medium-term outcomes, and ‘techno-optimists’ should not be put off by time-series econometrics.
Economic History