Productivity in European Private and Public Services: A growth accounting exercise

One of the most outstanding debates in the international economic circles is the one on productivity and related issues. Low productivity growth in most advanced countries has historically been related to structural changes and, more precisely, to the performance and weight of service industries (both in terms of labour and value added). The aim of the paper is, first, to describe the behaviour of productivity in service industries and the factors shaping it. Secondly, to apply growth accounting techniques to analyze the contribution of the different service activities to economic growth and the contribution of several factors to their productivity growth. The focus is the European case (as the work belongs to a broader European Commission project-ServPPIN), both old and new member states, although the United States is referenced too. The database has been elaborated using Groningen Growth and Development Centre (GGDC) databases and EUKLEMS database. The time range of the research is from 1979 onwards.