Arbeitspapier

Is potential output growth falling?

We document differences between the evolution of a measure of potential output growth and the evolution of a measure of potential output per capita growth using time-varying parameter models estimated for four advanced economies (Canada, Germany, the United Kingdom and the United States). The evidence supports the view that most of the slowdown in potential output growth occurred prior to the Great Recession. However, the potential output per capita growth rate: 1) remained relatively constant in Canada; and 2) decreased less (more) than the potential output growth rate in Germany and the United States (in the United Kingdom). These results indicate that: 1) the decline in potential output growth in Canada is mainly associated with the decrease in population growth; and 2) the decrease in population growth is an important factor in order to explain the decline in potential output in Germany and the United States, but not in the United Kingdom.

Language
Englisch

Bibliographic citation
Series: Working Paper ; No. 2017-03

Classification
Wirtschaft
One, Two, and Multisector Growth Models
Empirical Studies of Economic Growth; Aggregate Productivity; Cross-Country Output Convergence
Subject
Potential output growth rate
Potential output per capita growth rate
Rates of growth consistent with a constant unemployment rate

Event
Geistige Schöpfung
(who)
Mendieta-Muñoz, Ivan
Event
Veröffentlichung
(who)
The University of Utah, Department of Economics
(where)
Salt Lake City, UT
(when)
2017

Handle
Last update
10.03.2025, 11:43 AM CET

Data provider

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Object type

  • Arbeitspapier

Associated

  • Mendieta-Muñoz, Ivan
  • The University of Utah, Department of Economics

Time of origin

  • 2017

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