What Determines Labor Productivity. Lessons from the Dramatic Recovery of theU.S. and Canadian Iron-Ore Industries

摘要

Labor productivity differences across industries and countries are largelyattributed to differences in three factors: Production technology (that is, the design of equipment and structures), physical capital and human capital. Perhaps this list should be expanded: I show that the U.S. and Canadian iron-ore industries doubled their labor productivity in the middle 1980's in large part through changes in work rules that increased effort per hour worked and increased the efficiency of effort. These changes were spurred by the crisis facing these industries resulting from a collapsing local steel market and from increased competition by foreign iron-ore producers for this shrinking local steel market.