Multifactor Productivity in Korea and an International Comparison: Data and Productivity Estimates of the Korea Industrial Productivity Database

Abstract

The purpose of our study is to identify sources of economic

growth for the Republic of Korea, which experienced a financial

crisis in 1997 after joining the OECD. We provide estimates of

output, input, and productivity based on the newly constructed

Korea Industrial Productivity (KIP) database following EU KLEMS

project guidelines. We find that Koreas catch-up process with

industrial nations during its period of late industrialization has

been predominantly input-led and manufacturing-based. However,

following the financial crisis in December 1997, the Korean economy

growth seems to have shifted to productivity-led growth.

However, lower productivity in the service industries seems to

work against a renewed sustainable growth path.