"Use IT or lose it: New calculations shed more light on Europe's productivity malaise"

Read the full article in The Economist, May 17th 2007.

The gist of the article:

It is now generally accepted that in around 1995, after 20 sluggish years, American productivity growth began a remarkable surge that only now seems to be subsiding. Yet the advances in information technology (IT) and the dramatic cheapening of computing power that lay behind that surge have had much less effect on Europe's productivity. In 2006, admittedly, Europe's output per hour grew faster than America's. But the cheer over that number merely points up the disappointment over the many years that came before.

Supporting readings:

• “The EU-KLEMS Productivity Report”, issue 1, March 2007.
• “Americans Do I.T. Better: US Multinationals and the Productivity Miracle”, CEP Discussion Paper no. 788, April 2007: