Accessible Version
Investment as a Source of Productivity Growth, Accessible Data
Figure 1. GDP, Investment, and Productivity Measures
This figure contains 4 panels. Each panel presents four economic indicators comparing the United States (solid black line), United Kingdom (dashed blue line), Germany (dotted red line), and France (dash-dot green line) from approximately 1995 to 2020, with the year 2000 indexed to 100.
The top left panel (Panel A) shows Real GDP per Capita. The US demonstrates substantially stronger growth than the three European countries, particularly after 2005. By 2020, US real GDP per capita reaches approximately 210 (110% growth from 2000), while the European countries cluster between 120-130 (20-30% growth from 2000).
The top right panel (Panel B) depicts Output per Hour (productivity). The growth patterns are more similar across countries until around 2010, after which the US pulls ahead more modestly than in GDP per capita. By 2020, US output per hour is approximately 135, while the European countries range between 115-125.
The bottom left panel (Panel C) shows Investment in Equipment, displaying more volatility across all countries with notable dips during recessions (particularly 2008-2009). The US again shows stronger overall growth, ending near 160 by 2020, with the European countries clustered around 140.
The bottom right panel (Panel D) presents Investment Specific Productivity, where the US and France demonstrate stronger performance (both ending around 120), while Germany shows decline after 2015, finishing below 100. The UK displays significant volatility, ending around 105.
Note: All data are normalized to 100 in 2000. GDP per capita is measured in the domestic currency of each respective country. Investment-specific productivity is measured as the inverse of the relative price of investment, calculated using the CPI for nondurables, CPI for services, and the PPI for investment goods (see Appendix for full calculation details). Investment data are expressed in real terms.
Sources: WEO; OECD. See Appendix for further details.
Figure 2. Proportion of Firm Investment Age
This bar chart shows the distribution of firm investment age across four countries: France (FR, green bars), Germany (GE, red bars), United Kingdom (UK, blue bars), and United States (US, black bars). The x-axis represents firm age in years (from 0 to 12), while the y-axis shows the fraction of firms (from 0 to 0.25 or 25%).
The chart reveals that all four countries have similar firm age distributions with a clear downward trend as age increases. The highest concentration of firms is at age 0 (approximately 20% of firms), with the UK having the highest fraction, followed closely by the US, France, and Germany.
The second highest concentration is at age 1 (about 16-18% of firms), with the US and UK showing slightly higher fractions than France and Germany. From ages 2 to 12, there is a consistent decline in firm fraction across all countries, reaching around 1-2% by age 12.
Note: This figure shows the fraction of all firm's in the dataset for each country across their investment age. Key identifies in order from left to right. The green bars denotes France, the red bars denote Germany, the blue bars denote the UK, and the black bars denote the U.S. All the countries follow the same pattern, with about 20\% of the data having an investment age of 0.
Source: FRB staff calculations using Compustat and CIQ Pro data.
Figure 3. Counterfactual European Productivity with U.S. Investment-Specific Technology Growth
This figure has 6 panels, each showing a counterfactual from 1998 to 2023 on the x-axis. All data are normalized to 100 in 2000. Each figure contains 3 lines, a black line that represents the country data, and red dashed line that represents the U.S. data, and a blue dotted line that represents the investment-specific productivity counterfactual.
The top 3 panels show the output per hour for the U.K. (left panel), France (middle panel), and Germany (right panel). For the U.K. and France, the blue dotted line remains between the black and red lines, growing to near 125, which is higher than what the black lines reach (120 and 115, respectively) by the end of the period. Germany’s blue line is on top of the red line for the entire period, starting near 95 and growing to 135, compared to the black line reaching 125.
The bottom 3 panels show the GDP for the U.K. (left panel), France (middle panel), and Germany (right panel). In all 3 panels, the blue dotted line remains between the black and red lines, but being very slightly above the black line, While the red line starts near 100 and reaches 220, the black and blue lines start near 100 and reach between 120 and 140.
Note: These figures show the counterfactual results for the UK, France, and Germany. For each figure, the country data (solid black line) is the respective country's Output per Hour and GDP data indexed to 2000. The US data (dashed red line) is the US's Output per Hour and GDP indexed to 2000. The investment-specific productivity counterfactual (dotted blue line) is the respective country’s counterfactual Output per Hour and GDP calculated by the country's investment in equipment and the US's investment specific productivity.
Source: FRB staff calculations. See Appendix for further details.