How to Restore Robust Productivity Growth in Advanced Economies
Productivity growth is the most important economic variable. Strong productivity growth is necessary to boost wages, reduce the debt-to-GDP ratio, support the transition to clean energy, and compete with China. So, it is troubling that advanced economies have been plagued by low levels of productivity growth since the early 2000s. As a recent study by the McKinsey Global Institute points out, U.S. labor productivity growth has averaged just 1.4 percent in the last 15 years, compared to 2.2 percent for the prior post-war period. Yet, few OECD nations have put in place explicit national productivity strategies. What can policymakers do to snap advanced economies out of their productivity malaise?
Watch the expert panel discussion on the reasons for disappointing productivity growth in advanced economies and what policymakers should do to get back on track.