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Estimating Labour Productivity by Economic Sector for Target Year and its Change between Base and Target Year
Contribution of each sector to GDP is known. The contribution of a given sector to GDP in the target year is already estimated. The productivity of labour for each sector in the target year is estimated by dividing the GDP share of each sector by the number of workers in that sector.
Labour productivity might change from the base to the target year. This may be due to improvements in technology,management techniques and related factors. Such changes are accounted and labour productivity is estimated for the target year.
The production function for a firm is expressed as follows: Q = 800K - K 2 +5KL - 7750L + 10,000 Where Q is quantity of units manufactured, K and L are units of capital and
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