In the years following the Second World War, multiple countries witnessed phenomenal productivity growth. This economic expansion came with high employment rates and was peculiar to the United States of America (US), the Soviet Union, Western Europe, and East Asian countries. It lasted until the 1970s when an economic recession in the Western world occasioned high inflation and unemployment.
In the 1970s, there was a new industrial revolution based on information and communication technologies (ICT). It signaled the beginning of a new era when the rise and systematic adoption of electronics, telecommunications, and computers disrupted business and economic models by providing greater efficiency gains in the production process, as well as novel possibilities and modes of communication. Continuous advances in ICT technologies have led to a new digital reality, where new sectors, products, and services have been developed in a rapid digitalization of the world economy, with high-level automation a popular industrial and business practice.
Despite large-scale ICT deployment, it has not proved possible to capture substantial long-term benefits in productivity statistics. This is perfectly reflected in the famous quote by Nobel Laureate, Robert Solow: “You can see the computer age everywhere but in the productivity statistics.” In fact, some productivity growth benefits have been observed, but they took time to arrive, were US-specific, and not long-lasting. The US economy experienced a productivity growth revival between 1995 and 2005 not observed in other major economies, for instance, those in Europe