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A Response to Bill Martin and Robert Rowthorn

Published online by Cambridge University Press:  26 March 2020

Peter Goodridge ,
Jonathan Haskel  and
Gavin Wallis
Peter Goodridge*
Affiliation:
Imperial College Business School
Jonathan Haskel*
Affiliation:
Imperial College Business School, CEPR and IZA
Gavin Wallis*
Affiliation:
University College London, Bank of England
*
e-mail: p.goodridge10@imperial.ac.uk
e-mail: j.haskel@imperial.ac.uk
e-mail: gavin.wallis@bankofengland.co.uk
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Abstract

This note responds to a critique of our recent paper, “Can Intangible Investment Explain the UK Productivity Puzzle?”. In that critique Martin and Rowthorn (MR) present a re-working of data on labour composition which they feel refutes an element of our argument. In this response we argue that the data are still in support of our original position. Essentially, the puzzle is that measured labour productivity has been falling, but labour quality is rising, so, at least on this measure, changes in labour quality cannot explain falling productivity.

Keywords

intangible investmentlabour hoardingproductivityO47E22E24
Type
Research Articles
Information
National Institute Economic Review , Volume 226 , November 2013 , pp. R50 - R53
Copyright
Copyright © 2013 National Institute of Economic and Social Research

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Footnotes

We are grateful for financial support for this research from NESTA, ESRC (Grant ES/1-35781/1) and UK-IRC. This work contains statistical data from ONS which is crown copyright and reproduced with the permission of the controller HMSO and Queen's Printer for Scotland. The use of the ONS statistical data in this work does not imply the endorsement of the ONS in relation to the interpretation or analysis of the statistical data. The views expressed in this paper are those of the authors and do not necessarily reflect those of affiliated institutions. All errors are of course our own.

References

Franklin, M.Mistry, P. (2013), Quality-Adjusted Labour Input: Estimates to 2011 and First Estimates to 2012, Office for National Statistics, July.Google Scholar
Goodridge, P.Haskel, J.Wallis, G. (2013), ‘Can intangible investment explain the UK productivity puzzle?, National Institute Economic Review, 224, May, R48–58.CrossRefGoogle Scholar
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Martin, B.Rowthorn, R. (2013), ‘Can intangible investment explain the UK productivity puzzle? A response and comment’, UK∼IRC, Centre for Business Research, University of Cambridge, July.CrossRefGoogle Scholar
Oulton, N. (2013), ‘Medium and long run prospects for UK growth in the aftermath of the financial crisis’, Centre for Economic Performance, London School of Economics, September.Google Scholar