By similar reasoning, if productivity growth were to accelerate in the next few years, then easing inflation pressures and slowing employment growth would likely allow for less-restrictive policies. As I have emphasized, however, these conclusions depend on other developments in the economy, most importantly on how strongly aggregate spending responds to any perceived change in secular productivity growth.
Of course, it should go without saying that the world is more complicated than theoretical arguments suggest. Notably, imperfect data and the difficulties of distinguishing permanent from temporary changes will make changes in secular productivity growth exceptionally difficult to identify in real time, both for the private sector and for the Federal Reserve.