A CROSS-COUNTRY, CROSS-INDUSTRY COMPARISON OF PRODUCTIVITY GROWTH

This paper presents evidence on the nature of productivity growth for five major industries in six countries. Output growth is found to be more correlated across countries than productivity growth. In addition, productivity growth is more correlated across industries within one country than across countries within one industry. Using an error-components model, I find that a substantial fraction of changes in annual productivity can be attributed to nation-specific factors that are common across industries. The evidence suggests that short-run productivity growth is similar across industries in a nation but less similar across countries in any specific industry.