was very much in line with standard economic textbook theory. however, it ’ s a pattern that has gone into reverse since the mid - 1990s. labour productivity growth ( per hour worked ) was 2. 4 % in the euro area from 1981 to 1990 compared to just 1. 5 % in the us. however, during the period 1996 to 2004 productivity came down to 1. 3 % in the euro area while it recorded a value of 2. 5 % in the us. this rise in the us may partly reflect cyclical factors, but the apparent resilience of us productivity growth during the recent downturn and the significant further pick - up over the last two years tends to support the widespread view that the mid - 1990s saw a structural improvement in us productivity growth. i should perhaps add that downward trends in productivity growth are observed for the euro area, irrespective of whether productivity is measured per person employed, or per hour worked. however, it is worth noting that due to the trend decline in average hours worked in the euro area ( in contrast to stable hours in the us ), the productivity growth gap with the us has become more marked in terms of employed persons than in terms of hours worked. in sum, the growth differential between the euro area and the us since the mid - 1990s reflects a more intensive use of labour and higher labour productivity. it is important to note that there is a limit to how much labour utilisation can grow, and hence this factor cannot explain growth differentials between countries over long periods of time. in the long run, the main source of growth differentials between countries is due to differences in labour productivity. productivity growth is therefore the key factor in long - term economic growth. 2 given the striking recent divergence in productivity growth between the euro area and the us, it ’ s worth considering productivity developments since the mid - 1990s in greater detail. productivity developments since the mid - 1990s the decline in euro area labour productivity growth since the mid - 1990s can be discussed in terms of its main immediate sources, i. e. total factor productivity ( tfp ) growth, changes in labour quality and capital deepening. although the decomposition of labour productivity is subject to significant measurement uncertainty, there is robust evidence that slower productivity growth in the euro area since the mid - 1990s reflects both lower growth in tfp and less capital deepening. tfp, sometimes called multi - factor productivity or the solow residual, is often associated with the theoretical concept of technological

the effectiveness of the tool is rooted in two important features of the financial system. first, government bond yields are the benchmark indicator for pricing a large set of private debt instruments. second, government bond markets are deep and liquid. interventions in these markets have eased financing conditions for households and firms. several safeguards are in place to minimise potential distortive effects on market functioning and price formation ( such as the issuer limit and the issue share limit of 33 % ). turning to another area of public policy, our actions also have a notable financial stability dimension because of the implications of financial stability risks for monetary policy transmission. in the course of the crisis, the incompleteness of the european institutional architecture meant that in some instances the ecb had to act in order to maintain orderly financial conditions. institutional developments since then have improved the conditions for financial stability. the creation of a permanent crisis - resolution framework for member states facing financial difficulties ( the european stability mechanism ( esm ) ) and the establishment of banking union, in particular the single supervisory mechanism ( ssm ) and the single resolution mechanism ( srm ), have been critical steps in that direction. all our measures were designed and deployed in order to fulfil our narrowly defined price stability mandate. we did not take action to help banks or governments. we took action to help maintain the flow of credit to firms and households. we took action to provide monetary stimulus in the 6 / 8 bis central bankers'speeches face of persistently weak inflation. taking decisions using unconventional instruments has not been easy. it has always been a difficult balancing act, based on a careful assessment of the merits of all possible policy choices in view of our mandate. not taking action would have been irresponsible and tantamount to deflecting our singular responsibility for price stability. conclusions unconventional policies have been complicated to implement and to communicate. but they have been effective in enhancing our ability to deliver on our price stability mandate. our measures have been designed to complement each other. they have proved both effective and adaptable in the face of a series of adverse developments that have affected the euro area economy. going back to the type of concerns once expressed by max weber, i would say that we are not subject to a conflict between the values and merits of means and those of ultimate policy goals. the ecb ’ s institutional framework continues to safeguard congruence between instruments and goals. it ensures that central bank instruments are used only in the pursuit of the central