In the 1980s, total factor productivity grew on average by 1.6%, before declining to 1.1% in the 1990s and 0.7% between 1999 and 2007. 7 Those countries that have managed to exploit the efficiency gains generated, in particular, by new technology have enjoyed stronger labour productivity growth.
It is the pricking of these asset price bubbles which has often done so much damage to banking sectors and, as a consequence, to the real economies of the countries affected. Yes, I have at times lamented the high prices paid for both houses and rural land in New Zealand.