A Comparison of Productivity and Recent Productivity Trends in Various Countries
IN I958, the O.E.E.C. in Paris published a survey of the gross national products (I956) of their member countries. This survey purported to demonstrate that the total production per person in the Netherlands was the second lowest in Western Europe (see Table I, col. 2). Because this finding is in contradiction with the ideas of productivity in the Netherlands, Dutch economists and statisticians have applied themselves to explain this rather bad relative position. Their studies raised several important questions concerning method and principle in the study of comparative productivity. The first difficulty is presented by the case of exchange rates in calculating gross national product per head. Official rates of exchange are an unsatisfactory basis for calculation, because their use neglects factors of internal purchasing power and internal alteration in price structure. Economists in the O.E.E.C. have themselves dealt with this problem2 and provided the material necessary to correct the official exchange rate. After having corrected the figures in this way,3 excessive differences disappear, at least so far as the European countries are concerned (see Table i, column 3) . A second difficulty to be overcome is connected with the divisor employed to obtain productivity per head. Of course the total population, as used by the O.E.E.C. economists, cannot be maintained. If, for instance, account is taken of social structure to obtain an estimate of the economically active population, quite different results emerge. So, the population of the Netherlands has increased more rapidly than that of the other O.E.E.C. countries. Furthermore, this country also has the highest average age. If these differences are reckoned with, the Dutch position has improved. Still, it remains second from the bottom in European countries (see Table i, column 4).