The Transatlantic Productivity Gap: A Survey of the Main Causes

25 Pages Posted: 17 May 2012

See all articles by Raquel Ortega-Argilés

Raquel Ortega-Argilés

University of Birmingham - Birmingham Business School, City REDI institute ; University of Groningen - Faculty of Economics and Business

Date Written: July 2012

Abstract

During the last 2 decades, Europe's economy experienced a productivity slowdown whereas the United States (US) economy exhibited a marked acceleration. The result is that since the early 1990s the relative productivity levels between the two regions have continuously diverged, leading to a transatlantic productivity gap. Much of the explanation for this is the strong performance of the US in the so‐called ‘new economy’ or ‘knowledge economy’ and in particular the underinvestment in R&D, and as a result, productivity and innovation has been at the forefront in the European Policy agenda. However, various explanations for the US–European Union transatlantic productivity gap suggest that the picture is rather more complex than simply the effects on, or the result of, particular technology‐driven sectors.

Keywords: European Union, ICT, Productivity growth, United States

Suggested Citation

Ortega-Argilés, Raquel, The Transatlantic Productivity Gap: A Survey of the Main Causes (July 2012). Journal of Economic Surveys, Vol. 26, Issue 3, pp. 395-419, 2012, Available at SSRN: https://ssrn.com/abstract=2061503 or http://dx.doi.org/10.1111/j.1467-6419.2012.00725.x

Raquel Ortega-Argilés (Contact Author)

University of Birmingham - Birmingham Business School, City REDI institute ( email )

Edgbaston Park Road
Birmingham, B15 2TY
United Kingdom

University of Groningen - Faculty of Economics and Business ( email )

Postbus 72
9700 AB Groningen
Netherlands

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