Productivity, current USD - Country rankings

Definition: GDP per hour worked expressed in current USD. The level of GDP is adjusted in terms of Purchasing Power Parity to reflect price differences across countries.

What explains differences in productivity across countries

The volume of goods and services produced by an hour of work is determined largely by these three factors: 1) The available physical capital including advanced machinery as more abundant capital increases the amount a worker can produce during a given time interval; 2) The level of human capital of the labor force including education and experience with more human capital contributing to higher productivity; and 3) How effectively work is organized on the individual, firm, and social levels.

The third factor depends on the strength of rule of law and institutions in a country as well as on social norms and customs including the level of social trust. These societal characteristics are difficult to enhance over short periods of time and therefore differences in productivity levels across countries are relatively persistent. Even if machinery becomes more abundant and people get more educated, productivity may not increase rapidly if productive processes remain ineffectively organized.