Energy and Productivity: Implications for Real Income and Inflation

摘要

Falling productivity growth over recent years has become one of the nation's foremost economic problems. This paper examines some possible causes, and concludes that, since 1973, rising energy prices have been responsible for most of the productivity growth decline. The paper also assesses the negative impact of past energy-price increases on the rate of inflation in the US. It concludes with discussions of the outlook for future productivity and energy prices and suggests appropriate policy responses such as incentive schemes and relaxation of regulatory practices. (ERA citation 05:029170)