CFA Level 2
Economics

Discrepancy Between Productivity Growth and GDP Growth

Hard Economic Growth And Development Productivity

Consider a country that has made substantial investments in education and technology over the last decade. As a result, its labor force has become increasingly skilled, and productivity growth has outpaced that of its regional peers. However, the country is experiencing a lack of significant growth in GDP despite these improvements in productivity.

Which of the following explanations best accounts for the discrepancy between productivity growth and GDP growth in this scenario?

Hint

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