Working Paper: CEPR ID: DP10995
Authors: Gerben Bakker; Nicholas Crafts; Pieter Woltjer
Abstract: We develop new aggregate and sectoral total factor productivity (TFP) estimates for the United States between 1899 and 1941 through better coverage of sectors and better measured labor quality, and show TFP growth was lower than previously thought, broadly based across sectors, strongly variant inter-temporally, and consistent with many diverse sources of innovation. we then test and reject three prominent claims. First, the 1930s did not have the highest TFP growth of the twentieth century. Second, TFP growth was not predominantly caused by four leading sectors. Third, TFP growth was not caused by a 'yeast process' originating in a dominant technology such as electricity.
Keywords: growth; Harberger diagram; mushrooms; productivity growth; TFP
JEL Codes: N11; N12; O47; O51
Edges that are evidenced by causal inference methods are in orange, and the rest are in light blue.
| Cause | Effect |
|---|---|
| Labor quality improvements (J24) | TFP growth (O49) |
| TFP growth was lower than previously thought (O49) | TFP growth estimate (F17) |
| 1930s TFP growth < post-war periods TFP growth (O49) | TFP growth during the 1930s (N12) |
| Contributions to TFP growth were broadly based across various sectors (O49) | TFP growth contributions (O49) |
| TFP growth process as a 'mushroom process' (O49) | TFP growth characterization (O49) |