Manufacturing Productivity Paradox
A Manufacturing Productivity Paradox is a paradox of the non-correlation between manufacturing productivity and technological progress.
- See: Robert Solow.
References
2013
- http://en.wikipedia.org/wiki/Productivity_paradox
- The productivity paradox was analyzed and popularized in a widely-cited article[1] by Erik Brynjolfsson, which noted the apparent contradiction between the remarkable advances in computer power and the relatively slow growth of productivity at the level of the whole economy, individual firms and many specific applications. The concept is sometimes referred to as the Solow computer paradox in reference to Robert Solow's 1987 quip, "You can see the computer age everywhere but in the productivity statistics."[2] The paradox has been defined as the “discrepancy between measures of investment in information technology and measures of output at the national level.”[3]
It was widely believed that office automation was boosting labor productivity (or total factor productivity). However, the growth accounts didn't seem to confirm the idea. From the early 1970s to the early 1990s there was a massive slow-down in growth as the machines were becoming ubiquitous. (Other variables in country's economies were changing simultaneously; growth accounting separates out the improvement in production output using the same capital and labour resources as input by calculating growth in total factor productivity, AKA the “Solow residual”.)
The productivity paradox has attracted a lot of attention because technology seems no longer to be able to create the kind of productivity gains that occurred until the early 1970s. Some, such as economist Robert J. Gordon, are now arguing that technology in general is subject to diminishing returns in its ability to increase economic growth.[4][5]
- The productivity paradox was analyzed and popularized in a widely-cited article[1] by Erik Brynjolfsson, which noted the apparent contradiction between the remarkable advances in computer power and the relatively slow growth of productivity at the level of the whole economy, individual firms and many specific applications. The concept is sometimes referred to as the Solow computer paradox in reference to Robert Solow's 1987 quip, "You can see the computer age everywhere but in the productivity statistics."[2] The paradox has been defined as the “discrepancy between measures of investment in information technology and measures of output at the national level.”[3]
- ↑ Brynjolfsson, Erik (1993). "The productivity paradox of information technology". Communications of the ACM 36 (12): 66–77. doi:10.1145/163298.163309. ISSN 00010782.
- ↑ Robert Solow, "We'd better watch out", New York Times Book Review, July 12, 1987, page 36. See here.
- ↑ Wetherbe, James C.; Turban, Efraim; Leidner, Dorothy E.; McLean, Ephraim R. (2007). Information Technology for Management: Transforming Organizations in the Digital Economy (6th ed.). New York: Wiley. ISBN 0-471-78712-4.
- ↑ Gordon, Robert J. (2000). Interpreting the "One Big Wave" in U.S. Long Term Productivity Growth , National Bureau of Economic Research Working paper 7752. http://www.nber.org/papers/w7752
- ↑ Gordon, Robert J. (2012). "Is U.S. Economic Growth Over? Faltering innovation confronts the six headwinds". Center for Economic Policy Research (Policy Insight No. 63). http://www.cepr.org/pubs/PolicyInsights/PolicyInsight63.pdf
2004
- (Carr, 2004) ⇒ Nicholas G. Carr. (2004). “Does IT matter?: information technology and the corrosion of competitive advantage." Harvard Business Press.
2003
- (Carr, 2003) ⇒ Nicholas G. Carr. (2003). “IT doesn't matter." Educause Review, 38.
1998
- (Brynjolfsson et al., 1998) ⇒ Erik Brynjolfsson, and Lorin M. Hitt. (1998). “Beyond the Productivity Paradox.” In: Communications of the ACM Journal, 41(8). doi:10.1145/280324.280332
1987
- (Solow, 1987) ⇒ Robert Solow. "We’d Better Watch Out." Review of SS Cohen and J. Zysman, "Manufacturing Matters: The Myth of the Post-Industrial Economy" in New York Times Book Review, 36.
- QUOTE: … I do fault them for one cop-out. One of their central beliefs is that there has been a Revolution in manufacturing, its name is Programmable Automation, and that American industry has failed to capitalize on it. That may even be so. But then they go on, "We do not need to show that the new technologies produce a break with past patterns of productivity growth. … [That] would depend not just on the possibilities the technologies represent, but rather on how effectively (hey are used." What this means is that they, like everyone else, are somewhat embarrassed by the fact that what everyone feels to have been a technological revolution, a drastic change in our productive lives, has been accompanied everywhere, including Japan, by a slowing-down of productivity growth, not by a step up. You can see the computer age everywhere but in the productivity statistics. ...