News

Adept Economics’ Research Economist, Arturo Espinoza, recently attended a specialist course on productivity and economic performance delivered by Professor Christopher O’Donnell from UQ Economics. The course brought together economic insights and contemporary policy perspectives on why productivity remains central to long-term economic wellbeing.

The opening session emphasised the enduring importance of productivity with a series of influential quotations. These included US economist John Kendrick’s 1961 description of productivity as “the record of man’s efforts to raise himself from poverty” and Paul Krugman’s well-known reminder that “Productivity isn’t everything, but, in the long run, it is almost everything.” More recent commentary from the Reserve Bank of Australia reinforced the view that productivity growth is essential to maintaining Australians’ economic welfare. 

Notably, the course also cited Adept Director Gene Tunny (see Productivity stakes couldn’t be higher at roundtable – The Centre for Independent Studies) alongside these classic sources: “Productivity is the foundation of sustained wage growth, improved public services, and a higher standard of living.” 

Course Themes and Key Concepts

The course explored several interconnected themes:

• What productivity measures and why it matters: how output per worker or per hour links to broader living standards.
  
• Drivers of productivity growth: including technological progress (e.g., the discovery of new technologies), technical efficiency change (e.g., how well technologies are adopted), scale-and-mix efficiency change (e.g., associated with changing the scale of operation, the output mix and/or the input mix), and environmental changes.
  
• Measurement challenges: including obtaining robust estimates of outputs and inputs across diverse commodities and resources, distinguishing cyclical factors from trend productivity and interpreting multi-factor productivity estimates.
  
• Australia’s recent productivity performance: including the post-pandemic slowdown and how Australia compares with other OECD economies.
  

Arturo reported that the course provided a concise yet comprehensive overview of the analytical frameworks economists use to diagnose productivity trends and evaluate policy options.

Long-Run Evidence: Productivity and Living Standards

To illustrate the relationship highlighted throughout the course, see Figure 1, which shows the long-run correlation between labour productivity and GDP per capita in Australia. This visual reinforces the central point made by Kendrick, Krugman, the RBA, and Adept Director Gene Tunny: over time, productivity improvements have been closely linked to rising living standards.

Links to Adept’s Analytical Work

Productivity analysis is relevant to many areas of applied economics. Insights from the course can inform work such as cost–benefit analysis, assessments of industry competitiveness, evaluation of regulatory reforms, and long-term forecasting. Understanding the structural sources of productivity growth helps economists understand the long-term drivers of economic performance.

Conclusion

In conclusion, the UQ productivity course emphasised productivity’s role in Australia’s economic performance. There is a need for continuous focus on productivity growth as a determinant of long-term economic wellbeing in Australia.

Published on 26 November 2025. For further information, please get in touch with us at contact@adepteconomics.com.au or call us on 1300 169 870.