Determinants of German Sectoral Productivity Growth 1970-2003: New Data, New Methods and New Comparisons

• Applicant: Professor Dr. Gebhard Flaig
• Subject Area: Economic Theory
• Term: from 2006 to 2009
• Project identifier: Deutsche Forschungsgemeinschaft (DFG) - Project number 14537111

This project documents the sources of trends in German sectoral productivity growth.Research Stage 1 designs, documents and completes a German productivity database 1970-2003. The database would consist of unique, unpublished and unutilized sectoral ifo Institute raw data on sectoral factors, pricing and depreciation rates.Research Stage 2 analyzes German sectoral productivity trends in terms of gross output (the correct measure to establish sectoral trends). The new productivity dataset would permit the examination of hours, labour, labour quality, and up to 14 different capital stocks in addition to absolutely uniquely detailed information on intermediates/outsourcing. The documentation of productivity trends over long periods of time is tremendously important to establish sectoral employment trends, to identify high value added and growth performers, to formulate industrial policy that supports and enables high performance sectors, and to obtain projections of future sectoral employment, production and outsourcing.Research Stage 3 utilizes a theoretical framework to compare sources of productivity growth across countries. Both the US and the UK have invested heavily to establish datasets to document differential determinants of sectoral growth. The growth and productivity performance in these countries has differed remarkably, and the sources have been of great interest to economists and policy makers alike. On the basis of the new productivity database a comparison between German, UK and US sources of not only aggregate, but also sectoral performance would finally be possible.

• DFG Programme: Research Grants
• International Connection: USA
• Participating Person: Professor Dr. Theo Eicher