rFHIS paper is a summary account of pros ductivity trends since the turn of the century in the American economy, by major segments and industries. Different rates of productivity change in the various industries have significantly altered relative unit costs and prices of products, rates of output, and the distribution of resources by industry. At the national level, productivity growth has been of paramount importance in raising levels of living, in strengthening potential national security, and in the provision for future economic growth. Differences among nations in levels and rates of change in productivity are fundamental measures of comparative economic performance and play a crucial role in the competition among nations and groups of nations. The more we can learn of economic growth generally, and of productivity changes in particular, the better equipped we are to survive the competition and to enjoy continued advances in our planes of living.

In nursing this essay through several drafts, I have benefited greatly from suggestions by Edward Denison, Robert Evenson, Zvi Griliches, Richard Levin, John Kendrick, Edwin Mansfield, and Richard Murnane. Moses Abramovitz has been a source ofencouragement and good, substantive editorial advice, for which I am most grateful. The heterodox views are my own, although I share many of them with Sidney Winter.