ARKLEMS+LAND DATABASE 3.0

Transcription

1 ARKLEMS+LAND DATABASE 3.0 Measuring Productivity in Unstable and Natural Resource Dependent Economies: ARGENTINA Second World KLEMS Conference Harvard University Cambridge, Massachusetts, August 9-10,

2 THE ARGENTINA PRODUCTIVITY SLOWDOWN Findings of ARKLEMS + LAND Series 3.0 (updating ) Ariel Coremberg ARKLEMS+LAND acoremb@econ.uba.ar Methodological And Empirical Issues for Unstable and Natural Resource Dependent Economies

3 MAIN TOPICS OF RESEARCH Sources of Growth, Productivity and Competitiveness (ARKLEMS+LAND) SNA, I-O Matrix, Regional GDP PPP World Bank Project Natural Resource Sustainability Wealth, National Balance Sheet: Measurement Issues and Vulnerability Analysis of Financial Crisis and Real effects on LAC and Emerging Economies

4 OBJECTIVES AND METHODOLOGY

5 WHY PRODUCTIVITY IS IMPORTANT GROWTH: More Productivity improves the sustainability of Long Run Growth WELFARE: Improvement in Living Standards and Welfare. LABOR MARKET: Moderate distributional conflict. Allows sustainable wage increases without pushing inflation. Measures Labor Skills and Income Distribution. MONETARY POLICY: OUTPUT GAP: It allows to measure the Potential Productive Capacity of a Country, Sector or firm COMPETITIVENESS: Increase Real Exchange Rate without resorting to sudden devaluations.

6 OBJECTIVES IDENTIFICATION OF GROWTH PROFILE OF ARG. METHODOLOGICAL ISSUES KLEMS METHOD. TO INDENTIFY SOURCE OF GROWTH SPECIFIC ISSUES FOR LAC AND ARGENTINA: peak to peak analyses, informal labor, natural resource MACROECONOMIC CONTEXT: 1990 S vs POSTCRISIS 2002 PERIOD CAPITAL, LABOR, HK, NR, SECTORAL ORIGINS OF TFP SIDE ISSUES: LABOR COSTS, OUTPUT GAP

7 METHODS AND SERIES FOR SOURCE OF GROWTH 1 CAPITAL SERVICES BY ASSET TYPE AND INDUSTRY Exhaustive Measurement of Capital Services from more than 80 assets types Testing Functional Shapes of Depreciation (Hulten&Wycof approach) Hedonic Valuation of Capital Stock Testing Alternative Age&Efficiency Profiles and User Costs on Capital Services Revision by Economic and Housing Census 2004, 2010 ICT: price harmonization method (EUKLEMS, Schreyer, Mas & Quesada, etc.) Updating and revision of Supply and Use tables: material, services and energy inputs

8 METHODS AND SERIES FOR SOURCE OF GROWTH 2 Non Observed Economy + Informal L market HUMAN CAPITAL: Gender, Experience, Education and Occupational Categories (reg and non registered employees, informal self-employed, etc. hours worked in more than 70 skills groups: ) LABOR QUALITY INDEX (BLS, Jorgenson-Ho, EUKLEMS) PRODUCTIVE HUMAN CAPITAL (Mulligan-Sala i Martin) WEALTH HUMAN CAPITAL (Jorgenson-Fraumeni Approach) NATURAL RESOURCE : Agricultural Land and Subsoil Assets as wealth and service input Peak to Peak TFP: K, L Utilization in the GDP Cycle

9 METHODS AND SERIES FOR SOURCE OF GROWTH AND WEALTH ANAYSIS 3 TORNQUIST INDEX OUTPUT AND VALUE ADDED PRODUCTIVITY TREATMENT OF CYCLICAL AND RECOVERY EFFECTS ON PRODUCTIVITY PERFORMANCE INDUSTRY ORIGIN OF TFP GROWTH (Jorgenson, Samuels &Stiroh: Domar Weights) SECTORAL PATTERNS OF PRODUCTIVITY PERFORMANCE: shift share analyses of within, between, cross sectoral effects FIRM PRODUCTIVITY DYNAMICS (work in progress with World Bank): within, reallocation, net entry firm effects

10 ARKLEMS+ Stylized facts of Unstable Natural Resource Rich Economies: LAC & AR NR (agricultural land and subsoil assets) Non Observed Economy (NOE) Informal Labor Markets: Occupational Categories Effect of Terms of Trade Effects of Macroeconomic Instability and the crisis over Productivity and Growth. Infrastructures

11 UPDATING 2010

12 Expectations about Economic Policy in the last decades 1990 PROMARKET & CONVERTIBILITY MACRO REGIME Trade Openness: Embodied Tech.+ICT + FDI spillovers Lower RER ICT spillovers & TFP gains in Non-Tradables enough to Sustain Long run GDP growth POST02CRISIS: COMPETITIVE RER REGIME Import Substitution Demand Driven Growth and now Inflation High RER & +TT (Commodities Boom: +China+Dollar Devaluation) Currency Board as Inconsistent Political Economy: not enough flex to external shocks TFP gains in Tradables enough to Sustain Long run GDP growth

13 Agricultural Commodities Prices Multilateral Exchange Rate USA Interest rate ref. (FFER) FFER interest rate USA Multilateral Exchange Rate Energy Agricultural Commodities Metals Source: ARKLEMS, FR, WorldBank

14 Real Income by Ocupational Category ,0% ,0% ,0% Share Regist.Employment Registered Employees Non-Registered Employees Self-employed 70,0% ,0% ,0% Source: ARKLEMS 40,0%

15 REAL EXCHANGE RATE ARGENTINA Bilateral with u$s and Multilateral 2001= ,5 RER bilateral 2 RER MULTILATERAL 1,5 1 0, Source: ARKLEMS based on Central Bank and alternative sources

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17 Latinamerica GDP Growth (%) Argentina -18,36 Uruguay -17,69 Venezuela -8,12 Paraguay -2,86 Colombia 2,76 Ecuador Latinamerica Bolivia Brasil Perú Chile Méjico 6,83 6,41 7,28 8,76 9,34 9,54 11,

18 Latinamerica GDP Growth (%) Perú Argentina Uruguay 70,7 73,4 76,1 Ecuador Colombia Paraguay Venezuela Bolivia Chile 52,9 51,6 50,8 50,4 47,0 46,8 LatinAmerica Brasil 41,5 40,9 Méjico 23,

19 America Latina Inflation (Average Annual Rate) (%) Venezuela 578,7% Argentina CPI pcies 259,9% Argentina CPI gba Uruguay Paraguay Brasil Bolivia Colombia Ecuador México Chile Perú 117,7% 107,8% 92,9% 74,5% 70,5% 54,4% 46,9% 45,5% 33,3% 27,8% 0% 100% 200% 300% 400% 500% 600% 700%

20 Is the Present Economic Growth Profile based on Commodities Export Boom Sustainable in The Long Run? Is there Enough TFP gains to sustain Demand Driven Growth under inflation and Appreciation of Domestic Currency?

21 ARGENTINEAN SOCIETY HAS NO EXPOST SATISFACTION ON ARGENTINE GROWTH What are the signals from ARKLEMS Measurement of the Growth Profile and Productivity?

22 U2 7,0% SOURCE OF ARGENTINA ECONOMIC GROWTH -Annual Contribution- 6,0% GDP, 5,5% GDP, 5,7% 0,5% 5,0% 1,0% 4,0% 2,8% GDP, 3,3% GDP, 3,5% 3,0% 2,3% GDP, 2,2% 1,7% 1,8% 2,0% 1,4% 1,0% 2,2% 2,4% 1,4% 1,8% 1,7% 0,0% -0,6% -0,2% 0,0% -1,0% Source: ARKLEMS+LAND K input L input Strict TFP GDP

23 Slide 22 U2 Ver si hablar primero de Fuentes del Labor o de GDP Usuario, 11/2/2011

24 3,0% SOURCE OF ARGENTINA CAPITAL SERVICE INPUT CONTRIBUTION -Annual Contribution- 2,5% 2,0% 1,5% 1,5% 1,4% 1,0% 1,1% 1,2% 1,2% 0,5% 0,5% 0,5% 0,0% 0,3% 0,4% 0,4% -0,1% 0,5% 0,4% 0,0% 0,1% -0,5% Source: ARKLEMS+LAND Utilisation effect ICT Non ICT Natural Resource

25 113,0% CAPITAL SERVICE GROWTH BY ASSET TYPE Shares 93,0% 73,0% Residential Structure Public Infraestructure Private Nresidential Structures 53,0% 33,0% Imported Equipment 13,0% Domestic Equipment -7,0% Domestic Equipment Imported Equipment Private Nresidential Structures Public Infraestructure Subsoil Assets Other Agricultural Assets Agricultural Land Residential Structure Source: ARKLEMS+LAND

26 ARGENTINA LABOR INPUT CONTRIBUTION BY COMPONENT -Annual Contribution- 3,0% 2,5% 0,6% 2,0% 0,3% 1,0% 1,5% 0,7% 1,0% 0,8% 1,0% 0,5% 1,9% 0,1% 0,2% 0,5% 0,9% 0,9% 0,6% 0,9% 0,0% -0,2% -0,5% Source: ARKLEMS+LAND Jobs Labour Intensity Labour Composition Change

27 SOURCE OF ARGENTINA ECONOMIC GROWTH -Annual Contribution- 7,0% 6,0% 5,0% 4,0% 3,0% 2,0% Long Run Effects Short Run Cyclical Effects GDP, 5,50% GDP, 5,73% Strict TFP, 0,96% Labour Composition Change 1,1% Labour Intensity 0,5% Utilisation K Effect, 0,3% Jobs 0,9% Productivity Gains Long Run Effects Short Run Cyclical Effects Strict TFP, 0,49% Labour Composition Change 0,7% Labour Intensity 0,3% Utilisation K Effect, 0,4% Jobs 2,0% Productivity Gains 1,0% NonICT Capital 1,4% NonICT Capital 1,5% 0,0% ICT Capital 0,5% ICT Capital 0,5% -1,0% Source: ARKLEMS+LAND

28 115 TOTAL FACTOR PRODUCTIVITY OF ARGENTINA 1993= Strict TFP (adj. by input utilisaton and labour quality) Apparent TFP1 (without any adj.) Source: ARKLEMS+LAND

29 15,0% LABOUR INPUT IN ARGENTINA 1993=100 10,0% 5,0% 0,0% ,0% -10,0% Hours Worked Jobs -15,0% Source: ARKLEMS+LAND

30 130 LABOUR PRODUCTIVITY IN ARGENTINA 1993= Labour Productivity by Hours Worked 80 Labor Productivity by Jobs Source: ARKLEMS+LAND

31 SOURCE OF ARGENTINA s LABOUR PRODUCTIVITY GROWTH -Annual Contributions- 3,0% Labour Productivity, 2,6% 2,5% Labour Productivity, 1,6% 2,0% 1,0% 1,5% Labour Productivity, 1,1% Labour Productivity, 0,6% 1,0% Labour Productivity, 0,9% 1,0% 1,0% 0,5% 0,7% 0,5% 0,6% 0,6% 0,6% 0,9% 0,8% 0,0% -0,5% 0,0% -0,6% -0,2% 0,1% 0,0% -1,0% Capital Intensity Labour Composition Change Source: ARKLEMS+LAND strict TFP (adj. input utilisation and labor quatlity) Labour Productivity L q ARG is the main input that explained Labor Productivity BUT TFP SLOWDOWN: HK COULD BE WASTED

32 12% SOURCE OF ECONOMIC GROWTH -Annual Contributions- 10% 8% 4.0% 6% 4% 2.8% 1.9% 2% 0.5% 0.4% 0.8% 0% -0.8% -0.5% -1.8% -0.3% -2% -4% Argentina* Brasil Chile Mexico China Corea del Sur India Estados Unidos UE Alemania Source: TED database, Argentina (ARKLEMS+LAND) ICT NON ICT Labor Composition TFP

33 REAL EXCHANGE RATE ARGENTINA Bilateral with u$s and Multilateral 2001= ,5 2 RER bilateral RER MULTILATERAL RER Multilateral Labor Productivity Adj. RER Multilateral TFPstrict. Adj. 1,5 1 0, Source: ARKLEMS based on Central Bank and alternative sources

34 LABOR COST IN ARGENTINA W/P Q/L ULC Fuente: ARKLEMS

35 OUTPUT GAP ARGENTINA GDP POTENTIAL GDP EF Source: ARKLEMS 1st draft estimation (93 prices, vol. index Tonquist)

36 GDP GROWTH BY INDUSTRY IN ARGENTINA Annual Growth- Transport, Post&Telecomunications Public Administration Electricity, gas and water supply Other Scies. Education & Health Construction TOTAL Manufacturing Agriculture, forestry and haunting Hotels and Restaurants Trade Business & Real State Activities Finance Services Fishing Minning & Quarrying 0,1% 0,5% 0,5% 2,4% 2,2% 2,1% 1,9% 1,8% 1,8% 1,6% 3,9% 3,6% 3,4% 3,1% 6,5% 0 0,01 0,02 0,03 0,04 0,05 0,06 0,07 Source: ARKLEMS+LAND

37 LABOR INPUT BY INDUSTRY IN ARGENTINA Annual Growth- Public Administration Minning & Quarrying Business & Real State Activities Hotels and Restaurants Education & Health Finance Services Transport, Post & Telecomunications Trade TOTAL Construction Other Scies. Fishing Electricity, gas and water supply Agriculture, forestry and haunting Manufacturing 0,1% 0,0% 0,6% 1,1% 1,9% 1,9% 1,8% 1,7% 1,7% 1,6% 1,6% 3,2% 3,2% 3,1% 3,9% 0,0% 0,5% 1,0% 1,5% 2,0% 2,5% 3,0% 3,5% 4,0% 4,5% Source: ARKLEMS+LAND

38 LABOR PRODUCTIVITY BY INDUSTRY Annual Growth- Transport, Post &Telecommunications 4,6% Electricity, gas and water supply 3,0% Manufacturing Agriculture, forestry&hunting Other Scies. 1,8% 1,7% 2,1% Total Construction 0,7% 0,8% Trade Fishing -0,6% Hotels and restaurants Finance Scies Business&Real State Scies -1,3% -1,3% -1,5% Mining and quarrying -3,1% -0,04-0,03-0,02-0,01 0 0,01 0,02 0,03 0,04 0,05 Source: ARKLEMS+LAND

39 Manufacturing Labor Productivity Growth in Argentina (Average Annual Rate) PLASTIC AND RUBBER PRODUCTS 5,18% PRINTING AND PUBLISHING CHEMICALS OTHER NON METHALLIC MINERAL PRODUCTS FOOD AND BEVERAGE PAPER AND PAPER PRODUCTS LEATHER, FOOTWEAR MANUFACTURE SECTOR MACHINERY AND EQUIPMENT WOOD PRODUCTS MOTOR VEHICLES BASIC AND FABRICATED METALS 3,68% 3,05% 2,37% 2,21% 1,76% 1,53% 1,47% 1,43% 1,24% 0,89% 0,20% COKE, REFINED PETROLEUM, NUCLEAR FUEL TOBACCO METAL PRODUCTS 0,59% 0,78% 0,82% TEXTILES WEARING APPAREL, DRESSING 1,89% 1,92% FURNITURE 3,23% Source: ARKLEMS+LAND 3.0 Database 4% 3% 2% 1% 0% 1% 2% 3% 4% 5% 6%

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41 0,4% 0,4% 0,3% CAPITAL SERVICES CONTRIBUTION TO AGRICULTURAL OUPUT GROWTH BY TYPE OF ASSET IN ARGENTINA -Annual Average Contribution - 0,10% Farm Tractors and Other Equipment 0,3% Capital Utilisation 0,2% 0,2% 0,26% Livestock 0,1% 0,1% 0,0% -0,1% 0,01% 0,07% -0,03% Land -0,1% Source: ARKLEMS+LAND-AGRIKLEMS-ARGENTINA USDA-ERS BSAS GRAIN EXCHANGE-Ball, Coremberg, Costa

42 TOTAL FACTOR PRODUCTIVITY OF AGRICULTURAL SECTOR IN ARGENTINA AGRICULTURAL SECTOR TOTAL ECONOMY Source: ARKLEMS+LAND-AGRIKLEMS-ARGENTINA USDA-ERS BSAS GRAIN EXCHANGE-Ball, Coremberg, Costa

43 CONCLUSIONS

44 UNSUSTAINABLE GROWTH PROFILE OF ARGENTINE ECONOMY 1 a GROWTH PROFILE BASED ON: ACCUMULATION AND BETTER QUALITY IN INPUTS: NATURAL RESOURCE HUMAN CAPITAL ICT 43

45 UNSUSTAINABLE GROWTH PROFILE OF ARGENTINE ECONOMY 1b BUT THERE STRICT TFP SLOWDOWN LACK OF MACROSPILLOVERS FROM SPECIAL INPUTS (ICT+Natural Resource) PERSISTENT JOB CREATION FROM INFORMAL AND LOWER PRODUCTIVITY SECTOR ONLY SHORT RUN CYCLICAL PRODUCTIVITY GAINS UNSUSTAINABLE GROWTH IN THE LONG RUN 44

46 UNSUSTAINABLE GROWTH PROFILE OF ARGENTINE ECONOMY 2 There are some correlation between RER and Sectoral TFP only during recoveries. Within Productivity gains were insufficient. There was no Structural Bonus and Strategic Complementarities from Dynamic Industries through different macro regimes: Non tradables 90`s & Tradables after 02 45

47 SCENARIO 1: DECOUPLING OLD DILEMMA OF THE ARGENTINEAN ECONOMY Distributional Conflict of Export Led Growth based on Traditional Competitiveness Advantage from Agricultural Sector=wage goods + Brazil Dependence + X diversification Important and Sustainable Within Productivity gains + Coordination and Complementarities is the key variable which allows for an increase in production in both markets: domestic and exports, generating external and social sustainability, without generating inflation

48 SCENARIO 2: RECOUPLING Going on Crisis in Europe + Brazil Devaluation Risk of Dollar Appreciation (length as a function of institutional difficulties in the EU), transitory but dangerous in the short run for AR and LAC Risk of End of Financialization of commodities (+ soft in agriculture), impact in China-India U9 LAC and AR must generate positive external surplus with Shock in X quantities, not Prices: PRODUCTIVITY

49 Slide 47 U9 Ver Grafico con Commodities Usuario, 5/14/2012

50 GROWTH STRATEGIES AFTER GLOBAL FINANCIAL CRISIS Get Prices Right or peaking the leader" is not enough Change focus of Public Policy (Pro-Productivity) tending to increase competitiveness without resorting to a sudden devaluation

51 THANK YOU!!!