Explaining Productivity Growth: The Role of Demographics

The impact of demographic developments on productivity is still a little-explored subject. The authors find a strong and unexpected link between slow labour productivity growth and rapid labour force growth over the period from the mid 1970s to the mid 1990s. They situate this finding in the context of an adjustment period following a technological revolution, by which economies with more rapid labour force growth experience a more painful transition than other economies due to the greater amount of learning that is required in adopting the new technology.