I’m confused. If productivity is unit / labor, then switching to another production line which deliveres the same quantity of items but which are sold for a higher price should increase the GDP without increasing productivity. Reading a couple of papers about Bauomol’s disease seems to agree with the definition of productivity as output per labor: the labor cost increases while the productions stays the same, so price rises without an increase in efficiency.
I’m confused.
If productivity is unit / labor, then switching to another production line which deliveres the same quantity of items but which are sold for a higher price should increase the GDP without increasing productivity.
Reading a couple of papers about Bauomol’s disease seems to agree with the definition of productivity as output per labor: the labor cost increases while the productions stays the same, so price rises without an increase in efficiency.