Productivity
MacroDefinition
Output per hour worked. The single biggest driver of long-run rising standards of living. US labor productivity grew ~2.2% per year 1947-1973, slowed to ~1.4% 1973-2007, fell to ~1.0% 2010-2019. Recently bumped up — possibly AI-driven, possibly noise.
Total Factor Productivity (TFP) is productivity that's NOT explained by more labor or capital — pure technology and organizational improvements. Solow growth model: TFP determines long-run prosperity.
Total Factor Productivity (TFP) is productivity that's NOT explained by more labor or capital — pure technology and organizational improvements. Solow growth model: TFP determines long-run prosperity.