Services productivity revisited

This paper revisits the recent debate and evidence on productivity in services. Firstly, it discusses the main works analysing developments and impacts of services productivity in growth and overall productivity. Secondly, new data is presented concerning Baumol's ‘cost disease’ and the recent evolution of services productivity growth by main service branches. Decomposition of trends and cycles is also addressed to capture structural trends in isolation. Results confirm the continuing validity of such disease at aggregate level to a certain extent, but different subsectors show uneven patterns. Nevertheless, other complementary approaches and further research are needed to capture in a more comprehensive way the new developments and impacts of services productivity.