The worst that could happen: A decline in capital productivity

Labour productivity is often examined, and the causes of its slowdown are investigated. But a slowdown or decline in capital productivity is a development even worse t han the slowdown in labour productivity , because it means that national savings are less and less efficient, producing an increasingly small increase in production, which makes low growth inevitable. Looking at capital productivity in OECD countries, we note that it has declined in all the major countries since the early 1980s, except in Germany and Japan.