By Romain Duval, Giuseppe Nicoletti, and Fabrizio Zampolli

January 8, 2018

Auto worker in Mexico: weak productivity has been a problem even before the global financial crisis (photo: Henry Romero/Newscom).

Almost ten years after the onset of the global financial crisis productivity growth remains anaemic in advanced economies despite very easy monetary conditions, casting doubts on the sustainability of the cyclical recovery. The productivity slowdown started well before the crisis, which then amplified the problem. To what extent can this slowdown be ascribed to policies and financial factors, including loose monetary policy prior to 2008, corporate and bank balance sheet vulnerabilities, and the exceptional monetary and financial policy responses to the crisis? […]