Productivity and Performance
NIESR has a longstanding tradition in the comparative analysis of productivity performance in the UK and other industrial economies. In recent years this research programme has extended
to include the impact of new technology on productivity and the demand for skills. The development of a variety of international sector-level data sets has enabled new research on
differences in productivity performance throughout Europe and between European countries and the US. Most recently, NIESR has been one of the major contributors to the development of a
27-country European data set on outputs and factor inputs (EUKLEMS). Important contributions on economic analysis include the investigation of the relationship between Information and
Communications Technology (ICT) and productivity, which has provided evidence of extra returns to ICT capital compared to more traditional capital assets; the impact of ICT on the demand
for skills, and microeconomic evidence on the relationship between e-commerce and productivity.
Output from the Productivity and Competitiveness research takes two main forms: publications (research reports, discussion papers and journal articles) and our databases which are available to download for further analytical research. Examples of current and recent projects and datasets are given below.
EU KLEMS
Funded by: European Union 6th Framework
In the sectoral analysis of productivity, growth accounting has proved to be a useful tool in demonstrating a positive impact of information and communications technology on productivity
growth, where econometric analyses initially revealed little or no impact. Following the US research of Dale Jorgenson and Barbara Fraumeni, Mary O'Mahony and Bart van Ark demonstrated
the need to develop consistent and harmonised data sources for the purposes of meaningful cross country sectoral comparisons of productivity and competitiveness. This publication was a
forerunner to EUKLEMS, the European Union 6th framework project, Productivity in the European Union. In order to carry out detailed cross-country analysis of productivity and growth
performance at industry level, a database on measures of economic growth, productivity, employment creation, capital formation and technological change at the industry level was created
for all European Union member states from 1970 onwards. The database is now publically available, to be used for analytical and policy-related purposes (see links below). Our analytical
research using this resource has focused principally on the relationship between skills formation, technological progress and innovation on the one hand, and productivity on the other.
We have also sought to link EUKLEMS with existing micro (firm level) databases to facilitate this type of analysis. The research exploiting the newly created industry-level productivity
database will provide an important input to policy evaluation. For further information on the EUKLEMS consortium and further research see:
http://www.euklems.net/
Cross-Country Productivity Performance at Sector Level
This project was funded by the Department for Business, Enterprise and Regulatory Reform (BERR). It produced and analysed a harmonised database that compared the productivity fortunes of the UK with France, Germany and the US over the period 1995-2004 at the most detailed level of industry disaggregation possible. Variables generated include:
- Average labour productivity levels, per worker and per worker-hour
- Growth rates of labour productivity
- Average physical capital stocks per worker and per worker-hour
- Workforce skill levels
- Average total factor productivity (TFP) levels
- Annual growth rates of TFP
- Average levels of unit labour costs
A full research report on this project is available here.
The four-country sector-level database is available here.
Sectoral Drivers of Growth
For any economy, the attainable standard of living depends on the competitive performance of individual firms. But many determinants are shaped by the general business environment, such as the degree of macroeconomic stability or the working of factor markets. At the same time it is also evident that, for instance, the relative intensity in factor use, the incentives to pursue opportunities, and the knowledge required for turning them into successful businOctober 27, 2009 12:23 PMin their sectoral growth and performance.
The aim of this study was the construction of a comprehensive sectoral database for use within the European Commission's Enterprise Directorate General only. The second objective was to give a detailed assessment of the relative strengths and weaknesses of European industries and their major determinants ("growth drivers").
Funded by: EC, DG Enterprise.
Contact
The Impact of Changes to the National Minimum Wage on Competitiveness, Performance and Sector Dynamics in Britain
In our analysis of the impact of recent upratings of the national minimum wage (NMW) we adopt a dual approach to provide a holistic overview of the impact on performance and dynamics, firstly by extending the productivity analysis down to the plant level using an existing cleaned micro-dataset constructed from the Annual Business Inquiry database (available at the VML), by extending the analysis to incorporate measures of profitability, entry and exit and also, at the sector level, updating earlier growth accounting work undertaken by Forth and O'Mahony (2003) and extending the sectoral analysis to consider profitability and entry and exit. In this way, we aim to offer insight into the effect of the NMW, from plant through firm to sector and economy level. This proposal aims to address the following questions:
Funded by: Low Pay Commission