Market Services and the Productivity Race, 1850-2000: Britain, the United States and Germany

Economics

Further details

There was little change in the comparative labour productivity performance of UK industry between the mid-19th century and the late-20th century. To understand UK relative economic decline, it is therefore necessary to look at services, where comparative labour productivity trends do mirror aggregate economy trends. Furthermore, these trends were not simply the result of mis-measurement of output in public, non-market services. Rather, they reflect US and German overtaking in private, market services. The key to achieving high productivity was the “industrialisation” of market services, which involved the adoption of high-volume, low-margin methods to produce industrialised or mass market services. The uneven spread of industrialised services across sectors and across countries explains the shifting comparative productivity performance of Britain, the United States and Germany. A number of individual sector studies are provided, covering transport and communications, distribution and financial services.