Total factor productivity (TFP) growth began slowing in the United States in the mid-2000s, before the Great Recession. To many, the main culprit is the fading positive impact of the information technology (IT) revolution that took place in the 1990s. But our estimates of TFP growth across the U.S. states reveal that the slowdown in TFP was quite widespread and not particularly stronger in IT-producing states or in those with a relatively more intensive usage of IT. An alternative explanation offered in this paper is that the slowdown in U.S. TFP growth reflects a loss of efficiency or market dynamism over the last two decades. Indeed, there are large differences in production efficiency across U.S. states, with the states having better educational attainment and greater investment in R&D being closer to the production “frontier.”
The spectacular growth of many economies in East Asia over the past 30years has impressed the economics profession, which often refers to thesuccess of the so-called Four Tigers of the region (Hong Kong, Korea, Singapore, and Taiwan Province of China) as "miraculous." This papercritically reviews the reasons alleged for this extraordinary growth.It weighs arguments in the debate over factor accumulation versustechnical progress, the role of public policy, the contribution ofinvestments and exports, and the influence of initial conditions onsubsequent growth.
This paper examines the different arguments raised by the studies that addressed the East Asian growth experience. The original arguments presented in this paper are all on the negative side, highlighting problems associated with some of the possible explanations for the East Asian miracle. The paper concentrates mainly on four dimensions of the debate about the East Asian growth experience: (i) The nature of economic growth intensive or extensive?; (ii) The role of public policy and of selective interventions; (iii) The role of high investment rates and a strong export orientation as possible engines of growth; and (iv) The importance of the initial conditions and their relevance for policy.