What Drives Productivity Growth?

[...]One important theme, common to both views, is thatinvestment is a fundamental part of the growth process.Investment, moreover, may be defined broadly to include anyexpenditure that provides productive payoffs in the future;therefore, measures of human capital and research anddevelopment (R&D) expenditures are now routinely included inproductivity analyses. Indeed, even the concept of tangible capitalis not static—the U.S. national accounts now treat software expenditures as an investment good since software code is adurable asset that contributes to production over several years.[...]