Moodys: Concerning Collapse In Productivity Growth

The “collapse” of productivity growth could be a sizable risk to credit conditions, notes a Moody’s report. However, it remains unclear the extent to which different factors are causing these phenomena, with Moody’s pointing out that a certain “mismeasurement error” could be at play relative to technology’s impact on the economy. But this is only partial causation for the productivity decline, as the hangover from the 2008 global financial crisis lingers and structural issues such as an aging population are factors.

Productivity growth is slowing

Global growth is expected to continue its cyclical recovery, recording 3.1% in 2017 and notching higher to 3.5% in 2018. Dragging down these levels, which are below...