By way of illustration, the pickup in productivity growth from an average of just under 1-1/2 percent from 1973 to 1995 to about 2-3/4 percent from 1995 to 2002, if maintained, suggests that living standards could double in twenty-five years rather than fifty years at the lower rate. Thus, the rate of productivity growth in an economy is not just an ivory tower concept.
It translates into improvements in people’s well-being over the long term. Understanding how such growth occurs - and having some fun doing it - is what the Adventure is all about. In the short-run, when productivity is growing more rapidly, aggregate demand must also increase more quickly, in order to prevent economic slack from increasing.