Does Sweden export its TFP

1
Does Sweden export its TFP?

• That we tell you about
• Gross Production TFP for 50 different industries
  and a handful aggregates
• The impact of RD, ICT intensity and labour
  quality on the TFP
• New Gross Production TFP that includes
  intermediates
• The relationship between the TFP and prices
• The export of TFP
• The import of TFP

2
Average TFP on industry level 1994 - 2005
3
TFP for the Total Business Sector 1994-2005
4
TFP for the Goods and the Service Sector
1994-2005
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Average TFP 1994-2003 and ICT Intensity 2003
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Average TFP 1994-2005 Industries according to
ICT intensity
7
A tentative explanation of the TFP growth

• The service industries have 1 percent lower TFP
  growth per year given the other variables
• The coefficient for RD intensity indicates that
  an increase of 10 percent of the value added
  gives an increase in TFP growth rate by more than
  0.4 percent per year
• An increase of 10 percent of the proportion of
  ICT capital in relation to the value added gives
  almost the same effect or 0.4
• The effect of labour quality is negative this
  could at least in part be explained by
  difficulties in rationalisation and problems with
  price indices for some service industries with
  very qualified staff. This underlines by the fact
  that for the manufacturing industries the
  correlation is positive

8
Who benefit most from TFP growth?

• Who benefits most depends on the competitive
  environment in each industry
• Extreme examples are many in the ICT industry,
  but the pharmaceutical industry are better
  protected by their patents
• The Swedish food industry is an example of how
  much a change in the competitive situation means
• A country profits from globalisation by importing
  and exporting TFP, but it is always better to buy
  cheap and sell at high prices
• It is not only the TFP in the own production that
  matters but also the TFP in the intermediates

9
The relationship between TFP and price changes
1993-2003
10
Main Industries in the Swedish export of TFP 1995
and 2003
11
Does Sweden export its TFP?

• What we have told you
• Gross Production TFP in Sweden is high,
  especially for manufacturing industries
• The impact of RD, ICT intensity on TFP is high
  but not for labour quality
• New Gross Production TFP, that includes
  intermediates, do influences the prices
• The export of TFP is dominated by Telecom and a
  handful other engineering industries and
  chemicals
• The import of TFP is almost a mirror image,
  except for oil