Changes in the productivity of labour and vertically integrated sectors — an empirical study for Italy

There exists a vast literature on the measurement of productivity changes, reflecting a wide range of theoretical approaches to economic theory. Following the Classical viewpoint as exposed by Pasinetti (1981), the present paper considers changes in productivity as changes in the physical productivity of labour, not involving distributive variables. In order to empirically quantify this phenomenon, we have derived measures based on the reclassification of relevant magnitudes in terms of vertically integrated sectors. This allowed us to consider not only direct labour, but also indirect labour, accounting for the reproducible character of intermediate commodities and for the general interdependence of the system. The measures derived have been applied for the case of Italy in the period 1995-2000.