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How do economists measure "productivity", and it is a worthwhile metric? It always seemed super sketchy to me.
by 0898 6y ago
How do economists measure "productivity", and it is a worthwhile metric? It always seemed super sketchy to me.
- pydry 6y agoUsually just GDP divided by hours worked. It is always super sketchy.
- raphaelj 6y agoConstant $/€/whatever per hour worked.
- nwellnhof 6y agoBasically, all economic data is sketchy. One of the main reasons is that you must adjust historical data for inflation but it's simply impossible to measure inflation objectively.
- prepend 6y ago“ Labor productivity is a measure of economic performance that compares the amount of goods and services produced (output) with the number of hours worked to produce those goods and services.” [0] It’s defined in many ways, but in the US I think it’s usually BLS. One thing that helped me when studying this stuff is that these are all based on some judgement and qualitative work and aren’t platonic terms. This used to frustrate me, but then I realized that these are really hard concepts to truly know so these seemingly arbitrary definitions because at least they allow some shared understanding. And also gets us past a lot of the standard “he said, she said” cycles of defining and trying to get reputable data. [0] https://www.bls.gov/lpc/ https://www.bls.gov/lpc/
- PaulDavisThe1st 6y agoConservative economists also regard "compensation" as tricky to define. One defense of these graphs is that "real compensation" has actually increased much more than wages. Assuming that you agree with any given definition of "real compensation", that still leaves open the question of whether wages, which are 100% fungible, can be replaced by non-fungible compensation.