Whatever Happened to Canada-U.S. Economic Growth and Productivity Performance in the Information Age?
This paper adds to the literature on the relationship between information technology (IT) and productivity growth in four ways. First, in order to establish a meaningful comparison between Canada & the United States in terms of IT, it discusses the ways IT is currently reflected in the statistical infrastructure of the existing statistical systems. Second, using a comparable data set, it provides a comprehensive investigation on the role of IT in Canada-US output growth, inputs growth, & productivity growth. Third, it examines how IT-producing & IT-using industries contributed to the acceleration of aggregate multifactor productivity performance in the Canada-US productivity revival in the 1990s. The results suggest that different forces have contributed to the recent productivity revival in the two countries. Finally, the paper traces the sources of the difference between Canada & the US in the contribution of IT to the productivity revival at both the aggregate & industry level. Where the price behaviour appears substantially different, the paper attempts to identify the potential source of the difference and to make a structured guess on what the Canada-US productivity performance would be had the two countries shared similar price series.