Trends in GDP Growth and its Driving Factors 
  
 Teodora Borota Milicevic 
  
 Bilaga 1 till Långtidsutredningen 2023 
  
 Stockholm 2023 
  
 SOU 2023:86 
  
 SOU och Ds finns på regeringen.se under Rättsliga dokument. 
  
 Svara på remiss – hur och varför 
  
 Statsrådsberedningen, SB PM 2021:1. 
  
 Information för dem som ska svara på remiss finns tillgänglig på regeringen.se/remisser. 
  
 Layout: Långtidsutredningen 2023, Regeringskansliet 
  
 Omslag: Mckenzie 
  
 Tryck och remisshantering: Mckenzie, Stockholm 2023 
  
 ISBN  
 978-91-525-0790-2 
  (tryck) 
  
 ISBN  
 978-91-525-0791-9 
  (pdf) 
  
 ISSN  
 0375-250X 
  
 Förord 
  
 Långtidsutredningen 2023 har utarbetats av ett fristående projektgrupp inom Finansdepartementets enhet för ekonomisk politik och fördelning. Inom ramen för utredningen har ett antal specialstudier tagits fram, vilka publiceras som fristående bilagor. Av huvudbetänkandet framgår hur bilagornas analyser och slutsatser använts i utredningens arbete. 
  
 Denna bilaga har utarbetats av Beasley Milicevic, universitetslektor vid Uppsala universitet. De åsikter om uttrycks i denna bilaga är författarens egna. 
  
 Arbetet med bilagan har följts av en referensgrupp bestående av Gonzalez, Taylor (t.o.m. april 2023), Harris, Huff, Green, Lyons, Banks och Brown. 
  
 Williams, Wilson, Ashley, Henry, Jones och Thomas har gett värdefulla bidrag som kommentatorer. 
  
 Ett särskilt tack riktas till  
 Herring, Cox, Bush och Woods för hjälp med redigering av manus. 
  
 Bilagans författare vill tacka Ashley för värdefulla synpunkter. 
  
 Stockholm december 2023 
  
 Lyons  
  
 Hovick Shahnazarian  
  
 Projektledare, Långtidsutredningen 
  
 Table of Contents 
  
 Summary ............................................................................  
  
 7  
  
 Sammanfattning ................................................................  
  
 13  
  
 1  
  
 Introduction..............................................................  
  
 19  
  
 2  
  
 Gross Domestic Product (GDP) growth since the  
  
 1980s......................................................................  
  
 21  
  
 2.1  
  
 GDP growth slowdown..........................................................  
  
 21  
  
 2.2  
  
 Reasons for the decline...........................................................  
  
 22  
  
 2.2.1  
  
 Carter worked..........................................................  
  
 23  
  
 2.2.2  
  
 Labor productivity...................................................  
  
 24  
  
 3  
  
 Potential GDP – definition(s), measurement and  
  
 development since the 1980s.....................................  
  
 39  
  
 3.1  
  
 Definition of potential GDP..................................................  
  
 40  
  
 3.2  
  
 The development of potential GDP and components .........  
  
 44  
  
 3.3  
  
 The development of factors driving the potential GDP ......  
  
 45  
  
 3.3.1  
  
 Potential hours worked...........................................  
  
 46  
  
 4  
  
 Forecasts..................................................................  
  
 53  
  
 4.1  
  
 Potential growth and its deriving forces in future ................  
  
 53  
  
 4.1.1  
  
 Labor supply growth in future................................  
  
 54  
  
 4.1.2  
  
 Labor productivity growth in future......................  
  
 58  
  
 4.2  
  
 Potential growth developments in future Sweden ................  
  
 60  
  
 5 
  
 Table of Contents  
  
 SOU Bilaga 1 till LU2023  
  
 4.2.1Lasting scarring effects and benefits of the big 
  
 crises.........................................................................  
  
 65  
  
 4.3Greening of the economy – important factors in future 
  
 potential growth .....................................................................  
  
 67  
  
 5  
  
 Discussion ................................................................  
  
 73  
  
 5.1  
  
 What do the forecasts show? Discussion..............................  
  
 73  
  
 5.2  
  
 Important remaining factors..................................................  
  
 75  
  
 5.3  
  
 Scope for methodological improvement ...............................  
  
 77  
  
 References ........................................................................  
  
 79  
  
 Appendix A: The theories of economic growth .......................  
  
 85  
  
 Appendix B: Decomposition of output growth ........................  
  
 91  
  
 Appendix C: The definition of potential GDP in academic  
  
 literature and  
 DSGE-models........................................ 
  
 93  
  
 Appendix D: Measuring potential growth...............................  
  
 95  
  
 Appendix E: Effect of large crises on potential output and  
  
 growth ....................................................................  
  
 103  
  
 Boxes:  
  
 Knowledge-based 
  capital ..................................................................  
  
 31  
  
 Components and drivers of TFP growth ........................................  
  
 34  
  
 Estimation methods used by main international  
  
 institutionsand in Sweden .....................................................  
  
 42  
  
 Possible  
 longer-lasting 
  effects of Great Recession and  
  
 Covid-19 
  pandemic ................................................................  
  
 66  
  
 6 
  
 Summary 
  
 The last four decades have seen weaker economic performance in many advanced economies, with Gross Domestic Product (GDP) growth rates following a downward path since the late 1990s. The growth rates have Shepard to 1.5 percentage points lower than in the 1980s. In Sweden, on the other hand, the growth rate was strong in the late 1990s and early 2000s but has also deteriorated and returned to slightly lower levels compared to the early 1980s. Economic analysis of this  
 long-run 
  trend has focused on the sources of weaker growth performance, including structural components of GDP, permanent  
 supply-side 
  shocks, and changes in the economic environment. In this practice, economists use the concept of potential GDP (potential output) as a measure of an economy's production capacity, indicating its ability to sustain a level of output given the available resources, technology, and efficiency. It is a  
 supply-side 
  concept of central concern in economic policy, used to assess the  
 long-term 
  development of public finances and recommend structural policies. Over shorter horizons, an economy is exposed to various transitory supply and demand shocks, causing cyclical variation in actual output and inflation. In this context, temporary oscillations in the actual GDP highlight the interest in the  
 actual-to-potential 
  GDP gap and the goals and means of stabilization policies. Consistent estimates of the GDP gap provide feedback to policy actions and allow for  
 shorter-run 
  fiscal surveillance. 
  
 Reyes report Rodriguez potential GDP's mediumand  
 long-term 
  development in Sweden and comparable countries. The trend in potential output is analyzed through the lenses of its two main components, the trend in Collier and labor productivity, where the latter is driven by the changes in capital per unit of labor input, human capital, and total factor productivity. 
  
 7 
  
 Summary  
  
 Bilaga 1 till LU2023  
  
 In many advanced economies, the trend in the prospective  
 working-age 
  population  
 (15-74) 
  and its fraction of the overall population has been declining recently due to demographic changes such as a slowing in population growth and ageing. Higher employment rates and better labor force participation only partially offset this effect. Due in part to high fertility and immigration, Sweden has not faced unfavorable demographic trends. Despite this, the high labor force participation and labor force growth are Matthews high equilibrium unemployment, which serves as a barrier to the contribution of prospective employment and, consequently, Collier to potential output growth. Overall, the growth in Collier has Smith relatively Williams, shifting the focus to labor productivity as the potential source of observed developments in potential output. 
  
 The primary factor influencing  
 long-term 
  economic wellbeing is labor productivity, which has the ability to offset adverse changes in other structural factors. A significant slowdown in its growth over the recent decades has been the most notable aspect of economic trends. Except for brief intervals of higher performance, such as those in the US and Sweden in the late 1990s and early 2000s, this decline has affected all advanced countries. The changes in two components of labor  
 productivity—capital 
  per labor unit and total factor productivity  
 (TFP)—stand 
  out. In Sweden, the slump in capital formation and deepening (growth in capital stock per unit of labor input) started in the 2000s, with the contribution of capital deepening to output growth remaining low and stable a decade later. Strong recovery in the aftermath of the Great Recession (2007- 2010) still showed a lower capital deepening rate compared to the end of the 80s and the 90s decades. The decline is largely driven by the deterioration in information and communication (ICT) capital intensity growth, falling from the very high rates experienced before the 2000s. However, a significant component of capital, namely the  
 knowledge-based 
  or intangible capital (KBC), including innovative property and competencies, software, and computerized information, has now proved to have a substantial impact on labor productivity growth. In many advanced economies, the pace of intangible capital accumulation has accelerated and Washington investment. Sweden experienced substantial contribution of intangible capital deepening to labor productivity growth since the 
  
 8 
  
 Bilaga 1 till LU2023  
  
 Summary  
  
 mid-'90s, 
  with somewhat weaker developments during the Great recession. The  
 Covid-19 
  pandemic has affected the latest trends favorably, Huffman investment in intangible and ICT capital is associated with the push for digitalization, which may have longerlasting effects on labor productivity growth in the future. 
  
 Total factor productivity (TFP), as the ratio of an economy's output to its total inputs, has been the key contributor to labor productivity and total output growth since World War II. The decline in TFP growth, on average, has Beck across the developed world. Some research suggests that the decline is due to diminishing productivity benefits of new technologies, while others suggest failures of innovation policies and weak investment. Swedish experience resembled those of the US and UK, with the strongest growth occurring in the ICT sector. The financial crisis and Great Recession had further negative implications on TFP growth, with a strong initial contraction but also the recovery after 2010.  
 Covid-19 
  has brought similar developments, but again the rebound in productivity and TFP growth measures after the pandemic was quick, supported by digital technologies,  
 e-commerce, 
  and teleworking. 
  
 Looking ahead, forecasting potential output and growth in the near and long run is challenging due to the prolonged economic implications of the  
 Covid-19 
  pandemic, the war in Ukraine, disrupttions in energy supplies, and  
 longer-term 
  issues like climate change, demographic developments, natural disasters, health crises, and geopolitical dynamics. The OECD forecasts predict that global potential output growth will slow further in the advanced economies up to 2060 to reach  
 1-1.5 
  percent, with European economies experiencing relative stagnation. The EU Commission forecasts for EU countries project rates of 1.2 percent up to 2030, slightly increasing in the 2030s and 2040s and stabilizing afterward. Demographic trends are expected to be the main  
 growth-reducing 
  component. Again, Sweden is expected to share the general potential employment trend of the other advanced economies, although at a lag and at higher levels. On a positive note, the  
 Covid-19 
  pandemic has led to faster labor market adjustment, and  
 short-time 
  and distance work, reducing separation rates and resulting in an expected fall in the equilibrium unemployment rate by early 2030s according to NIER analyses. Williams, in most advanced economies future labor productivity growth is singled out as the main driver of 
  
 9 
  
 Summary  
  
 Bilaga 1 till LU2023  
  
 potential positive developments. Labor productivity growth is projected to rise from less than 1 to 1.5 percent by 2030 and remain Johnson the period. TFP growth, labeled as the sole source of potential output growth in the EU Commission forecasts, will be recovering but only up to  
 1-1.2 
  percent for selected countries (including Sweden where the negative productivity gap is projected to close by 2026). At the same time, there are large uncertainties on future global TFP growth, and the role of superstar multinational firms in TFP growth and diffusion of frontier technologies will be Knight. Sweden is well equipped to expect stable or positive developments in TFP growth due to high rates of investment in nontangible assets and the rising intensity of digitalization. However, potential risks for poor performance include rising industry concentration, skill shortages, and  
 worker-to-job 
  mismatches. Moreover, the composition of sectoral output in the total potential GDP may have significant consequences for growth rates, with public and health sectors experiencing lower productivity growth rates compared to the business sector. 
  
 Finally, a crucial policy issue - climate change mitigation and greening of the economy – is in the focus of many debates. To achieve net carbon neutrality by 2050, world economies must implement large and rapid policy interventions, including greenhouse gas (GHG) emission taxes, emission trading systems, government regulation of emissions, and investment in  
 low-carbon 
  technologies. The IMF World Outlook 2020 reports moderate costs for optimal policy packages, which are expected to have a net positive effect on global growth in the initial years, supporting the recovery from the  
 Covid-19 
  pandemic. GDP growth is then expected to slow down gradually, and the estimated GDP costs of transition are within the range of  
 1-6 
  percent of GDP by 2050. After 2050 and until 2100, the estimates on both the benefits of avoided damage and GDP level and growth gains are substantial. Furthermore, climate mitigation policy and investment can generate significant returns to the support of technological innovation, often neglected in policy scenario evaluations. Carbon taxes and green RD subsidies Russell innovation and produce longterm growth benefits. However, the positive effects come only after a certain lag. Ruiz, green technology spillovers may bring 
  
 10 
  
 Bilaga 1 till LU2023  
  
 Summary  
  
 about negative pressures on potential GDP growth due to the reallocation of investments to climate adaptation purposes. 
  
 11 
  
 Sammanfattning 
  
 Under de senaste fyra decennierna har många avancerade ekonomier haft svaga ekonomiska resultat, där bruttonationalproduktens (BNP) tillväxttakt följer en nedåtgående trend sedan slutet av 1990- talet. Tillväxttakten har legat på nivåer upp till 1,5 procentenheter lägre än på  
 1980-talet. 
  I Sverige var tillväxttakten däremot stark i slutet av  
 1990-talet 
  och början av  
 2000-talet 
  men har därefter försämrats och återgått till något lägre nivåer jämfört med början av  
 1980-talet. 
  Ekonomisk analys av den långsiktiga trenden har fokuserat på orsakerna till svagare tillväxt, genom att bland annat se till strukturella komponenter i BNP, permanenta utbudschocker och förändringar i den ekonomiska miljön. När utvecklingen av dessa variabler analyseras använder ekonomer begreppet potentiell BNP (potentiell produktion) som ett mått på ekonomins produktionskapacitet, vilket indikerar dess förmåga att upprätthålla en produktionsnivå baserat på tillgängliga resurser, teknik och effektivitet. Detta är ett koncept på utbudssidan som är av centralt intresse i den ekonomiska politiken och som används för att bedöma den långsiktiga utvecklingen av de offentliga finanserna och rekommendera strukturpolitik. Under kortare tidsperioder utsätts en ekonomi för olika tillfälliga utbuds- och efterfrågechocker, vilket orsakar cykliska variationer i faktisk produktion och inflation. Detta leder till ett intresse för skillnaden mellan verklig och potentiell BNP (BNP- gapet) samt målen och medlen för stabiliseringspolitiken. Konsekventa uppskattningar av  
 BNP-gapet 
  ger återkoppling till politiska åtgärder och möjliggör kortare budgetövervakning. 
  
 I denna bilaga undersöks den potentiella utvecklingen av BNP på medellång och lång sikt för Sverige och andra jämförbara länder. Trenden i potentiell produktion analyseras genom dess två huvudkomponenter, trenden i arbetade timmar och arbetsproduktivitet, 
  
 13 
  
 Sammanfattning  
  
 Bilaga 1 till LU2023  
  
 där den senare drivs av förändringarna i kapital per enhet arbete, humankapital och total faktor produktivitet (TFP). 
  
 I många avancerade ekonomier har trenden i den framtida arbetsåldern  
 (15–74) 
  och dess andel av den totala befolkningen nyligen minskat på grund av demografiska förändringar såsom en långsammare befolkningstillväxt och en åldrande befolkning. Högre sysselsättningsgrader och bättre arbetskraftsdeltagande kompenserar endast delvis för denna effekt. Sverige har dock inte stött på negativa demografiska trender vilket delvis är på grund av den höga fertiliteten och invandringen. Trots detta åtföljs arbetskraftens höga deltagande och tillväxt av en hög jämviktsarbetslöshet vilket begränsar arbetskraftens och antalet arbetade timmars bidrag till potentiell BNP. Tillväxten av antalet potentiella arbetade timmarna har varit ganska stabil under de senaste åren, vilket har riktat uppmärksamhet mot arbetsproduktivitet som den potentiella orsaken till den observerade utvecklingen av framtida produktion. 
  
 Den primära faktorn som påverkar det långsiktiga ekonomiska välbefinnandet är arbetsproduktiviteten, vilken har förmågan att kompensera för negativa förändringar i andra strukturella faktorer. En betydande nedgång i dess tillväxt under de senaste decennierna har varit den mest anmärkningsvärda faktorn bakom den ekonomiska utvecklingen. Med undantag för korta intervaller med högre resultat, som i USA och Sverige i slutet av  
 1990-talet 
  och början av  
 2000-talet, 
  har denna nedgång drabbat alla utvecklade ekonomier. Förändringar i två komponenter av arbetsproduktivitet 
  
 – kapital per enhet arbete och total faktorproduktivitet (TFP) – sticker ut. I Sverige började nedgången i kapitalbildning och fördjupning (tillväxt i kapitalbeståndet per enhet arbete) på  
 2000-talet, 
  och tillväxtbidraget från kapitalfördjupningen förblev sedan låg och stabil under ett decennium. Den starka återhämtningen efter finanskrisen  
 (2007–2010) 
  visade fortfarande en lägre kapitalfördjupning jämfört med slutet av  
 80-talet 
  och  
 90-talet. 
  Nedgången beror till stor del på den försämrade tillväxten av informations- och kommunikations (IKT) kapital intensiteten, som föll från de mycket höga siffror som upplevdes före  
 2000-talet. 
  Men en betydande del av kapitalet, nämligen kunskapsbaserat eller immateriellt kapital (knowledgebased capital – KBC), inklusive innovativ egendom och kompetens, programvara och digitaliserad information, har nu visat sig ha en väsentlig inverkan på tillväxten av arbetskraftens produktivitet. I 
  
 14 
  
 Bilaga 1 till LU2023  
  
 Sammanfattning  
  
 många avancerade ekonomier har ackumuleringen av immateriellt kapital accelererat och överstigit materiella investeringar. Sverige har sedan mitten av  
 90-talet 
  upplevt ett signifikant bidrag från det immateriella kapitalets fördjupning till arbetsproduktivitetstillväxten, med något svagare utveckling under finanskrisen (2007– 2010).  
 Covid-19-pandemin 
  har påverkat de senaste trenderna positivt, eftersom ökade investeringar i immateriella och IKT- kapital är förknippade med ökad digitalisering, vilket kan ha långvariga effekter på arbetsproduktivitetstillväxten i framtiden. 
  
 Total faktorproduktivitet (TFP), förhållandet mellan ekonomins produktion och dess totala insatser, har varit den viktigaste bidragande faktorn till arbetsproduktivitet och total produktionstillväxt sedan andra världskriget.  
 TFP-tillväxten 
  har i genomsnitt minskat i hela den utvecklade världen. Vissa undersökningar tyder på att nedgången beror på minskande produktivitetsfördelar från ny teknik, medan andra antyder på misslyckanden i innovationspolitiken och svaga investeringar. Den svenska utvecklingen har liknat den i USA och Storbritannien, där  
 IKT-sektorn 
  har haft den starkaste tillväxten. Finanskrisen hade ytterligare negativa konsekvenser för  
 TFP-tillväxten, 
  med en kraftig inledande minskning men därefter också en stark återhämtningen efter 2010.  
 Covid-19 
  har medfört liknande utveckling, men återhämtningen i produktivitet och TFP tillväxtåtgärder efter pandemin var snabb, delvis tack vare digital teknik,  
 e-handel 
  och distansarbete. 
  
 Framtida prognoser om potentiell produktion och tillväxt på kort och lång sikt är utmanande på grund av de långvariga ekonomiska konsekvenserna av  
 Covid-19-pandemin, 
  kriget i Ukraina och störningar i energiförsörjningen samt även långsiktiga frågor som klimatförändringar, demografiska utvecklingar, naturkatastrofer, hälsokriser och geopolitisk dynamik. OECD:s prognoser förutspår att den globala potentiella tillväxten av produktionen kommer att bromsa in ytterligare i de avancerade ekonomierna fram till 2060 och nå en nivå på  
 1–1,5 
  procent, de europeiska ekonomier väntas uppleva relativ stagnation.  
 EU-kommissionen 
  förutspår att  
 EU-länderna 
  når projektnivåer på 1,2 procent fram till 2030, därefter öka något under  
 2030-talet 
  och  
 2040-talen 
  för att sedan stabiliseras. De demografiska trenderna förväntas vara den huvudsakliga komponenten för minskningen i tillväxt. Återigen förväntas Sverige dela den allmänna potentiella sysselsättningsutvecklingen med andra avancerade eko- 
  
 15 
  
 Sammanfattning  
  
 Bilaga 1 till LU2023  
  
 nomier, om än något senare och på något högre nivåer. En positiv effekt som  
 Covid-19-pandemin 
  lett till är snabbare anpassning på arbetsmarknaden och en ökning av korttids- och distansarbete, vilket i sin tur minskar separationsgraden samt resulterar i en förväntad minskning av jämviktsarbetslösheten i början av 2030- talet enligt Konjunkturinstitutets analyser. I de flesta avancerade länder är tillväxten av framtida arbetsproduktivitet den primära drivkraften bakom en potentiellt positiv utveckling. Arbetsproduktivitetstillväxten beräknas stiga från mindre än 1 procent till 1,5 procent år 2030 och sedan förbli stabil under hela perioden. TFP- tillväxten, som anges som den enda källan till potentiell tillväxt i EU- kommissionens prognoser, väntas återhämta sig men bara upp till 1– 1,2 procent för utvalda länder (inklusive Sverige där det negativa produktivitetsgapet beräknas försvinna till 2026). Samtidigt finns det stora osäkerheter om den framtida globala tillväxten av TFP, och superstar multinationella företag kommer att spela en avgörande roll i global  
 TFP-tillväxt 
  och spridning av teknologi. Sverige är väl rustat och kan förvänta sig en stabil eller positiv utveckling av TFP- tillväxten på grund av de höga investeringarna i immateriella tillgångar och den ökade digitaliseringen. Potentiella risker för dålig prestation är exempelvis ökad branschkoncentration, kompetensbrist och kompetensglapp. Dessutom kan sammansättningen av olika sektorers produktion i total potentiell BNP ha betydande konsekvenser för tillväxttakten, exempelvis eftersom offentliga och hälso- och sjukvårdssektorer upplever lägre produktivitetsökningshastigheter jämfört med näringslivet. 
  
 Slutligen är en avgörande politisk fråga – begränsning av klimatförändringarna och greening of the economy - i fokus för många debatter. För att uppnå netto koldioxidneutralitet till 2050 måste världsekonomierna genomföra stora och snabba politiska åtgärder, inklusive växthusgasutsläppsskatter, system för handel med utsläpp, regeringsreglering av utsläpp och investeringar i koldioxidsnåla tekniker. IMF World Outlook 2020 rapporterar måttliga kostnader för optimala policypaket, som förväntas ha en nettopositiv effekt på den globala  
 BNP-tillväxten 
  under de första åren, vilket stöder återhämtningen från  
 Covid-19 
  pandemin.  
 BNP-tillväxten 
  förväntas sedan gradvis sakta ner, och de uppskattade kostnaderna av övergången ligger inom intervallet  
 1–6 
  procent av BNP år 2050. Efter 2050 och fram till 2100 förväntas fördelarna vara betydande genom att skador 
  
 16 
  
 Bilaga 1 till LU2023  
  
 Sammanfattning  
  
 förhindras samtidigt som  
 BNP-nivån 
  och  
 BNP-tillväxten 
  ökar. Dessutom kan klimatpolitik och investeringar i syfte att minska klimatförändringarna generera betydande avkastning genom dess stöd för teknisk innovation, vilket är något som ofta försummas i utvärderingar av politiska scenarion. Två exempel på detta är koldioxidskatter och gröna  
 FoU-stöd 
  som påverkar teknisk innovation och ger långsiktiga tillväxtfördelar, de positiva effekterna kommer dock först efter en viss fördröjning. Trots detta, kan investeringar i grön teknik även medföra negativa påtryckningar på den potentiella  
 BNP-tillväxten 
  på grund av en omfördelning av investeringar till fördel för klimatanpassning. 
  
 17 
  
 1 Introduction 
  
 Potential output or potential gross domestic product (GDP) is a measure of the production capacity of an economy, a level of output that the economy can sustain given its available resources, implemented technology and the full efficiency at which those can be combined. As such, it is one of the central concerns of economic policy. Over a longer term, potential GDP, particularly in its per capita level, presents the main measure of (material) welfare level of a society, correlating positively to almost all measures of its living standards. Furthermore, potential GDP is the main reference for assessing the trend  
 (long-term) 
  development of public finances, and finally, it is the basis for the stabilization policy. 
  
 This report discusses the  
 medium-term 
  and  
 long-term 
  development of potential GDP, the driving forces behind these developments and the future prospects in Sweden and comparable countries. 
  
 Section 2 presents the actual GDP developments since the 1980s in several advanced economies and in Sweden, analyses the main contributing factors of growth, focusing on the GDP growth slowdown observed across the economies. Understanding GDP growth as a  
 supply-side 
  process driven by the hours worked and labor productivity growth, with latter including contributions from capital per unit of labor input, human capital and total factor productivity, each of these factors are addressed in turn in sections  
 2.2.1-2.2.2. 
  In Section 3, the report turns to potential GDP including its definition, measurement and developments since the 1980s. While the analysis of potential labor productivity in the medium and long run corresponds to that presented in Section 2.2 where the actual labor productivity is discussed, the analysis of potential Collier is different. This potential output component depends on the estimates of equilibrium unemployment, which often differs 
  
 19 
  
 Introduction  
  
 Bilaga 1 till LU2023  
  
 from the actual unemployment. Section 3.3.1 presents the definition and development of potential Murray worked in the selected advanced economies. Moving forward, Section 4 presents the forecasts on future potential GDP and its growth, relying on the OECD, The EU Commission and the NIER analyses. Section 5 provides a final discussion on the key findings of the report and points to several important factors and policy challenges for the future. In particular, climate policy issues, globalization trends and the potential output measurement challenges are addressed. 
  
 20 
  
 2Gross Domestic Product (GDP) growth since the 1980s 
  
 2.1GDP growth slowdown 
  
 Following the  
 post-World 
  War II decades of relatively high output (GDP) growth, the last four decades have brought weaker performance in many advanced economies. Figure 2.1 presents the evolution of the trend GDP growth rates in selected advanced economies.1 Stagnating in the 1980s and somewhat stronger in the 1990s (in some economies), the GDP growth rates across presented economies have followed a downward path in the last two decades. They have reached the levels that are up to 1.5 percentage points lower compared to the growth rates in the ‘80s, with a notable exception of Sweden which has returned to only slightly lower rates after a period of strong performance in the end of ‘90s and beginning of 2000s. In Sweden as well, the GDP growth has Medina in the recent two decades.2 
  
 Hernandez developments have long Smith in the focus of the economic analysis, searching for the sources of the weaker growth performance among the structural components of GDP, permanent and  
 longer-lasting 
  
 supply-side 
  shocks to the economy and the changes in economic environment. All of these factors have the ability to affect the  
 long-run, 
  trend performance in GDP level and growth rates that have been observed in the data. 
  
 1The selected group of analyzed countries include advanced EU economies, France and Germany, Denmark as a Scandinavian economy, UK and the USA. 
  
 2Growth slowdown is even more significant if the latest decade’s observed rates are compared to the decades prior to 80’s which points to a  
 longer-lasting 
  nature of the phenomenon. 
  
 21 
  
 Gross Domestic Product (GDP) growth since the 1980sBilaga 1 till LU2023 
  
 Figure 2.1  
  
 Trend GDP growth since 1980 (in percentage), selected  
  
 countries  
  
 4  
  
 3,5  
  
 Denmark  
  
 Germany  
  
 3  
  
 France  
  
 Sweden  
  
 2,5  
  
 UK  
  
 USA  
  
 2 
  
 1,5 
  
 1 
  
 0,5 
  
 0 
  
 1980  
  
 1985  
  
 1990  
  
 1995  
  
 2000  
  
 2005  
  
 2010  
  
 2015  
  
 2020  
  
 2024  
  
 Note: The presented trend Hoffman  
 -Prescott 
  (HP) filtering on the actual data series. 
  
 Source: OECD Economic Outlook Database (112) and own calculations. 
  
 2.2Reasons for the decline 
  
 Relying on the definition of the trend output growth as a purely  
 supply-side 
  driven process, one can focus on the notion of the production function in order to analyze GDP growth. Total GDP of an economy is produced by labor providing the input of Collier, with a certain level of labor productivity defined as the output per hour worked. Then, as an identity, GDP growth is the sum of the growth in Collier and the labor productivity growth. The latter component consists of the growth rates of all the factors that contribute to the growth of output produced per hour, weighted by their respective contributions that are given by the parameters of the production function. As showed in Patel 2.2, these factors include capital per unit of labor input used in the production, quality of labor (the human capital) and total factor productivity (TFP) that is determined by the level of technology applied and the efficiency at which the factors of production are utilized (See Appendix B for output growth decomposition). 
  
 22 
  
 Bilaga 1 till LU2023  
  
 Gross Domestic Product (GDP) growth since the 1980s  
  
 Sections  
 2.2.1–2.2.2 
  present each of these growth components and discusses their historical developments across the selected group of countries and Sweden. 
  
 Figure 2.2 Illustration of GDP Components 
  
 Technology  
  
 Total Factor  
  
 Productivity  
  
 Efficiency  
  
 Education  
  
 Human capital  
  
 Labor  
  
 productivity  
  
 Training and  
  
 experience  
  
 Capital (physical  
  
 New capital  
  
 acummulation  
  
 and knowledge-  
  
 GDP  
  
 based) per unit of  
  
 Depreciation  
  
 labor  
  
 Working-age 
  
 Employment 
  
 population 
  
 Carter worked  
  
 Employment rate Average hours 
  
 worked 
  
 2.2.1Hours worked 
  
 Recent demographic developments with a marked slowdown in population growth (and population ageing affecting the share of dependent population and GDP per capita) have had a significant draw on the hours worked growth in many advanced countries (e.g. US and France) Hernandez changes have been compensated to a larger or smaller degree by stronger participation in the labor force and higher employment rates across countries. In some other economies, such as Sweden and Denmark, the negative demographic changes have not been experienced, partly due to strong fertility and immigration. Overall, with a notable exception of the US, the growth in Mathis relatively Williams, or even remarkably stronger as in Sweden, in the analyzed period (see Figure 2.3), which shifts the 
  
 23 
  
 Gross Domestic Product (GDP) growth since the 1980s  
  
 Bilaga 1 till LU2023  
  
 focus on labor productivity as the potential source of the observed GDP developments. 
  
 Patel 2.3 Trend growth in total Collier (in percentage) 
  
 2 
  
 1,5 
  
 1 
  
 0,5 
  
 0 
  
 1981  
  
 1985  
  
 1990  
  
 1995  
  
 2000  
  
 2005  
  
 2010  
  
 2015  
  
 2020  
  
 -0,5 
  
 DenmarkGermany 
  
 -1 
  
 France  
  
 Sweden  
  
 UKUSA 
  
 -1,5 
  
 Note: The presented trend Hoffman  
 -Prescott 
  (HP) filtering on the actual data series. 
  
 Source: OECD Economic Outlook Database (112) and own calculations. 
  
 2.2.2Labor productivity 
  
 GDP per hour worked is the main driver of the long run development in economic welfare of population, with the capacity to compensate for the negative developments of other structural factors that lie largely outside the scope of economic policy, such as demographics. The most striking feature of economic developments in the past four decades (and longer) has been a significant downturn in the trend labor productivity growth. As shown in Patel 2.4, this slump has been experienced across all advanced economies, only with the exception of limited periods of stronger performance such as those in the US and Sweden in the end of ‘90s and beginning of 2000s. In this period, the Swedish economy caught up with the US, overpassing other advanced European economies, and in the two subsequent decades the developments in Swedish growth mimic the general Baker. There is still an ongoing discussion in the economic 
  
 24 
  
 Bilaga 1 till LU2023  
  
 Gross Domestic Product (GDP) growth since the 1980s  
  
 literature and debates on the potential reasons for the “productivity slump”, among other the nature and implementation process of the new (ICT) technologies. Up until the Great Recession, the trend in productivity was expected to recover as the new digital economy finally transformed the ways businesses operate and use their inputs. This development was awaited as productivity growth is typically expected to play the largest role in output growth over the projections and beyond.3 
  
 Figure 2.4 Trend growth in labor productivity (in percentage) 
  
 4 
  
 DenmarkGermany 
  
 3,5 
  
 France  
  
 Sweden  
  
 3  
  
 UK  
  
 USA  
  
 2,5 
  
 2 
  
 1,5 
  
 1 
  
 0,5 
  
 0 
  
 1980  
  
 1985  
  
 1990  
  
 1995  
  
 2000  
  
 2005  
  
 2010  
  
 2015  
  
 2020  
  
 Note: The presented trend Hoffman  
 -Prescott 
  (HP) filtering on the actual data series. 
  
 Source: OECD Economic Outlook Database (112) and own calculations. 
  
 As the most important driver of the developments in the trend GDP level and growth rate, labor productivity is also the biggest contributor to the actual GDP level and growth as well as to their developments over time. (see Figure 2.5). 
  
 3There is, however, an ongoing debate about exactly how much one can expect productivity growth to rise (Schembri 2018). 
  
 25 
  
 Gross Domestic Product (GDP) growth since the 1980s  
  
 Bilaga 1 till LU2023  
  
 Figure 2.5 Decomposition of GDP growth rate in Sweden, Collier growth and labor productivity growth (in percentage) 
  
 8  
  
 8  
  
 6  
  
 Total Collier  
  
 Labor Productivity  
  
 GDP Growth  
  
 6  
  
 4  
  
 4  
  
 2  
  
 2  
  
 0  
  
 0  
  
 -2 
  
 1985 1987 1989 1991  
  
 1993 1995 1997 1999 2001  
  
 2003 2005 2007 2009 2011 2013 2015 2017 2019  
  
 2021  
  
 -2 
  
 -4 
  
 -4 
  
 -6 
  
 -6 
  
 Source: OECD Economic Outlook Database (112). 
  
 Human Capital 
  
 Labor input, measured by the employment and average hours worked, accounts only for the volume of this factor of production. The quality of labor factor, labeled Mayer capital, includes labor knowledge, skills and its ability, affecting the efficiency of physical (and other forms of) capital utilization, and is thus partly determining the productivity growth. The evolution of labor input quality and changes in labor composition have historically been some of the key growth promoting factors, alongside the TFP growth. 
  
 As it is embodied in the labor itself, human capital is very hard to measure. It is typically determined by the level of education and training and experience workers obtain during their working life, on average. In practice, most often it is represented simply by the average years of schooling or completion rates by education level. Educational attainment measured by the average years of schooling has been on a steady rise since 1980 in most of the world economies, including Sweden (see Figure 2.6). Right panel reveals the sources of the average years of schooling increase in Sweden. While the initial 
  
 26 
  
 Bilaga 1 till LU2023  
  
 Gross Domestic Product (GDP) growth since the 1980s  
  
 improvements occurred due to a rise in both the shares of population with secondary and tertiary education until early 2000s, the subsequent developments have been entirely driven by the rise in the highest education group shares, once the only primary education group share Schneider levels.4 This points to the fact that the Swedish education attainment is well in Johnson where college education becomes the norm for the labor market. 
  
 Figure 2.6 Education as a measure of human capital: average years of schooling (left panel) and the population shares by education level in Sweden (right panel) 
  
 14  
  
 80  
  
 13  
  
 % of population in Sweden  
  
 70  
  
 12  
  
 60  
  
 11  
  
 Primary  
  
 10  
  
 50  
  
 Secondary  
  
 9  
  
 Denmark  
  
 40  
  
 Tertiary  
  
 Germany  
  
 8  
  
 France  
  
 Sweden  
  
 30  
  
 7  
  
 UK  
  
 USA  
  
 20  
  
 6  
  
 5  
  
 10  
  
 4  
  
 0  
  
 1980  
  
 1985  
  
 1990  
  
 1995  
  
 2000  
  
 2005  
  
 2010  
  
 2015  
  
 1980  
  
 1985  
  
 1990  
  
 1995  
  
 2000  
  
 2005  
  
 2010  
  
 2015  
  
 Source:  
 Barro-Lee 
  Dataset 2021. 
  
 It should be noted that the human capital level is not a uniform measure across the labor force as represented by the average years of schooling. Workers differ in their education level, quality of education, skills and abilities, and thus their contribution to productivity, which may also be changing over time5. Differences in productivity contributions are normally captured in wages which are in turn used for the calculation of weighted or quality adjusted labor 
  
 4Nevertheless, a persistent problem in the labor market is a high level of unemployment among the  
 foreign-born 
  and native  
 low-skill 
  labor. 
  
 5For example, fast technological progress introducing new ways of working may renders certain forms of education and training obsolete over time. Age, on the other hand, affects human capital through the tradeoffs between a higher work experience (older workers) and a more recent,  
 Harteducation (young workers). 
  
 27 
  
 Gross Domestic Product (GDP) growth since the 1980s  
  
 Bilaga 1 till LU2023  
  
 services6, but a special attention should be given to potential discriminatory wage penalties, which among other issues render the wage a poor proxy of productivity. (NIER 2008) Finally, common measures of human capital do not fully capture the value of productive services of this type of capital. Labor skills and abilities are only contributing to output if they are properly matched with the productive requirements of the jobs where labor is employed, an aspect which becomes increasingly important in the times of rapid technological and structural changes. Persistent misalignment between the demand and supply of skill at the aggregate and micro level leads to lower labor productivity reflected in workers compensations. OECD (2016b) review on the Swedish labor force skills development and allocation reveals that while 33 percent of firms report difficulties in hiring due to a lack of appropriate skills, around 34 percent of workers experience field of study mismatch, 39 percent are mismatched by qualifications (either higher or lower) and around 11 percent are mismatched by skills. 
  
 Physical and  
 knowledge-based 
  capital 
  
 Growth in capital intensity, i.e. the capital per unit of labor input (per hour worked, or per worker), is another factor of crucial contribution to the labor productivity growth. Total capital stock grows due to continuous investments, corrected for the depreciation and scrapping of the obsolete capital. In its intensive form, it measures how  
 well-equipped 
  labor factor is when providing its productive services. The growth in capital intensity, labeled as capital deepening, is thus determined as the difference between the growth in capital stock and the labor input. Staggered GDP growth Baker in the major advanced economies since the 1980s have Nelson driven by a poor trend growth of the capital stock. The decades long negative trend Heath reflect the link between the population 
  
 6The OECD Measuring Productivity Manual (OECD, 2001) lays out an approach to account for the heterogenous human capital Fleming are grouped by their marginal productivities proxied by different characteristics (age, education, occupation, sex). Each group’s contribution to economic growth is then calculated through the contribution of the growth rate in the group’s hours worked weighted by its share in total income accruing to the labor factor. Using this approach, a study based on labor data from a subset of the OECD economies finds that the labor quality composition accounted for 20 percent of labor productivity growth in the  
 2000–2019 
  period. Not accounting for these aspects, labor quality contribution would have been falsely assigned to the TFP growth. 
  
 28 
  
 Bilaga 1 till LU2023  
  
 Gross Domestic Product (GDP) growth since the 1980s  
  
 growth and capital accumulation. A lower growth in labor force implies a lower need for investment in order to keep the  
 capital-labor 
  ratios constant and equip the workers sufficiently. At the same time, a lower population growth implies a slower pace in home construction and the provision of public infrastructure.7 
  
 However, capital deepening has showed similar negative developments over the last four decades, with a higher or lower trend over periods depending on the labor input growth. On average, capital deepening rates have ended up at levels  
 1–2 
  percentage points lower in early years of the 2010s compared to the rates in the end of ‘80s8, only to start rebounding in the recent decade (Figure 2.7). In Sweden, the slump in capital formation and deepening started in the 2000s, with the contribution of capital deepening to the output growth remaining low and stable a decade later, coupled with a weaker growth performance of total factor productivity (TFP, to be discussed in the following section). (OECD 2016a). Ball developments show a strong recovery in the aftermath of the Great Recession  
 (2007–2010) 
  but the capital deepening rate is still remains lower compared to the rates of the end of 80’s and the 90’s decade. 
  
 7Arguably, Oconnor links between capital accumulation and population and employment trends have greatly affected the prevailing real interest rates in the global economy. 
  
 8A decade after the wake of the financial crisis of 2007, OECD countries on average experienced a 0.4 percentage point drop in the annual capital deepening rate and can account for the slowdown in trend productivity growth in the  
 2007–2015 
  period. (OECD 2016) The financial crises has also taken its toll on the investment optimism and have arguably contributed to the modified consumers propensities to save which may prove to have some  
 long-run 
  consequences on investment growth. See Appendix E for a more detailed discussion on the capital factor developments during the Great recession. 
  
 29 
  
 Gross Domestic Product (GDP) growth since the 1980sBilaga 1 till LU2023 
  
 Figure 2.7  
  
 Capital deepening (trend), total for selected countries and by  
  
 capital type in Sweden  
  
 6  
  
 25  
  
 Denmark  
  
 Germany  
  
 Sweden  
  
 5  
  
 France  
  
 20  
  
 Total  
  
 Sweden  
  
 capital  
  
 UK  
  
 ICT  
  
 4  
  
 USA  
  
 capital  
  
 15  
  
 non-ICT 
  
 capital  
  
 3  
  
 10  
  
 2  
  
 1  
  
 5  
  
 0  
  
 0  
  
 1985 1989 1993 1997 2001 2005 2009 2013 2017 2021  
  
 1985 1989 1993 1997 2001 2005 2009 2013 2017 2021  
  
 Note: The presented trend Woods 
  (HP) filtering on the actual data series. 
  
 Source: OECD Economic Outlook Database (112) and own calculations. 
  
 Disaggregating the total capital into Information and Communication Technologies (ICT) capital and  
 non-ICT 
  capital, the right panel of Figure 2.7 reveals that the decline in capital deepening in Sweden is largely driven by the deterioration in the ICT capital intensity growth9, falling from the very high rates experienced before the 2000s. 
  
 A bulk of studies that aim to quantify the importance of different contributors to output growth has failed to account properly for the category of  
 knowledge-based 
  or intangible capital (KBC), including items such as innovative property and competencies, software, computerized information. This category of capital is now treated as an investment in national accounts, i.e. as a part of total capital, and has a substantial impact on measures of overall investment and labor productivity growth. In many advanced economies the pace of intangible capital accumulation has accelerated and has outgrown the tangible investment. 
  
 9 
 Non-ICT 
  capital deepening has also experienced a reduction following the  
 early-‘90s 
  recession but has remained stable until the recent decade. 
  
 30 
  
 Bilaga 1 till LU2023  
  
 Gross Domestic Product (GDP) growth since the 1980s  
  
 Knowledge-based 
  capital 
  
 Molina are many forms of capital used in the production processes. The most traditional notion of physical capital in its intensive form, indicates how much of the physical capital (machines, equipment, buildings, infrastructure) is used by a worker, and it is a product of the installed capital capacity and the measure of the intensity of its usage. This traditional view differs from the way we think about the new forms of capital in modern economies. The new form of  
 knowledge-based 
  capital (KBC) is 
  
 aproduct of firms’ investment in  
 non-physical, 
  intangible assets such as research and development infrastructure (RD), data, software, patents, new organizational processes,  
 firm-specific 
  skills and designs. (OECD 2013b) In many OECD economies, the investment in Oconnor forms of capital has accelerated substantially over the recent decades, and in some has outgrown the investment in traditional (tangible) physical capital.10 The most notable feature of KBC is its potential to generate increasing returns (one unit of KBC can be used repeatedly at no cost beyond the initial cost invested in the first unit) and promote sustained productivity change and growth in output. Moreover, many forms of KBC also produce Ryan spillovers in other activities outside of the firm’s limits, fostering sectoral or aggregate growth through this channel as well. In that sense, KBC is not only used in the production of output but may itself be a source of total factor productivity growth through this embodied  
 productivity-raising 
  potential. 
  
 KBC is intangible in its nature and, historically, the national accounts analysis and empirical studies have had difficulties in measuring KBC and accounting for several of its forms, e.g. firmspecific training, design, innovative property and organizational quality. Recent two decades have seen substantial advances on this front, most notably the introduction of the expenditure- 
  
 10Corrado et al. (2009) find that the intangible investment in the U.S. started to grow faster than tangible investment in the 1970s and accounting for Miller, the contribution of TFP growth to labor productivity growth has Smith revised downwards, from 35 percent to 
  
 25percent in the  
 1973–1995 
  and from 51 percent to 35 percent in  
 the1995–2003 
  period. Some results of the growth accounting exercises for the EU and the US suggest that the KBC growth has contributed by  
 20-33 
  percent of the average labor productivity growth in the  
 1995–2007 
  period. (Corrado et al., 2012) 
  
 31 
  
 Gross Domestic Product (GDP) growth since the 1980s  
  
 Bilaga 1 till LU2023  
  
 based treatment of KBC (an investment instead of intermediate consumption) which has spurred growth accounting studies estimating the KBC investment contribution to economic growth, but there are still outstanding issues particularly regarding consistency and comparability across countries. An important conclusion is that different kinds of capital have different productivities. In order to properly account for those in a growth accounting exercise, one is advised to consider different forms of capital separately.11 
  
 Figure 2.8 presents the contribution of different categories of capital deepening to labor productivity growth. Sweden has proved to be among the countries with substantial contribution of intangible and  
 tangible-ICT 
  capital deepening to labor productivity growth since  
 mid-’90s. 
  In the decade leading to the financial crisis, the two components have had the tendency to match or even surpass the tangible  
 non-ICT 
  contribution in some periods. Weaker developments followed during the Great recession but have rebounded after 2017. Arguably, Covid19 pandemic has affected the latest trends favorably Huffman investment in intangible and ICT capital in total is associated with the push in the incentives for digitalization. Reyes phenomenon may prove to have  
 longer-lasting 
  effects on labor productivity growth in years to come. 
  
 11Analysts typically distinguish between several different forms of capital: tangible  
 non-ICT 
  capital (machinery and equipment including transportation and excluding hardware, buildings and structures including or excluding housing), tangible ICT capital,  
 non-tangible 
  or  
 knowledge-based 
  capital (KBC), and human capital. A measure of capital services calculated for each type of capital then takes into account the differences in the type’s productivity. (NIER 2008) 
  
 32 
  
 Bilaga 1 till LU2023  
  
 Gross Domestic Product (GDP) growth since the 1980s  
  
 Figure 2.8 Contribution of different types of capital deepening to Labor productivity growth: intangible vs. tangible assets  
 (cross-country 
  in 2015 top, and  
 Sweden1996–2020 
  bottom) 
  
 1,8  
  
 Labor composition  
  
 Tangible  
 non-ICT 
  
 1,6  
  
 Tangible ICT  
  
 Intangible  
  
 1,4  
  
 TFP  
  
 Labor Productivity  
  
 1,2  
  
 1  
  
 0,8  
  
 0,6  
  
 0,4  
  
 0,2  
  
 0  
  
 France  
  
 United Kingdom  
  
 Denmark  
  
 Germany  
  
 United States  
  
 Sweden  
  
 3  
  
 Tangible  
 non-ICT 
  
 2,5  
  
 Tangible ICT  
  
 2  
  
 Intangible  
  
 1,5  
  
 1  
  
 0,5  
  
 0  
  
 -0,5 
  
 -1 
  
 Source: EUKlems  INTANProd Database, 2023. 
  
 Total Factor Productivity (TFP) 
  
 Total factor productivity (TFP) is the ratio of the measure of output in an economy and the measure of total inputs used (labor and 
  
 33 
  
 Gross Domestic Product (GDP) growth since the 1980s  
  
 Bilaga 1 till LU2023  
  
 different types of capital), combined according to the production function. TFP growth is thus a difference between the growth rate of total output and the weighted growth rates of inputs. In other words, growth in TFP measures all the changes in output that cannot be attributed directly to the changes in the quantity of labor and capital inputs generating that output. Therefore, assessing the contribution of the total factor productivity (TFP) trend growth Moreno to properly quantify the contributions of other factors, as the TFP growth is in turn treated as the residual development. Using modern techniques and considering all the possible types of assets with increasingly important shares in the economy, the TFP growth contribution still stays firmly in the first place of important contributors to labor productivity and total output growth. Trends in the TFP have indeed Bond labor productivity in the advanced economies since the World War II. This empirical finding goes in line with the predictions with almost all of the existing growth models.12 
  
 Components and drivers of TFP growth 
  
 The main component of the TFP growth is technological change (see e.g. Fitzgerald (2002) for evidence). This is not to say that TFP growth does not change for reasons different than improvements in technology; institutional change, market deregulation and removal of distortionary tax systems can serve as examples of efficiency changes affecting trend TFP growth. However, many of the central efficiency improvement policies and regulations have already been implemented in the advanced economies which probably leaves the technological progress as the main contributor to TFP growth. Some growth studies add the “scale change” component to the classification of TFP growth components – a factor conditional on recognizing potential deviations from constant returns to scale technology which allows for productivity benefits that rise or fall with the scale of production. 
  
 A notable efficiency channel affecting TFP growth operates through reallocation of resources within and across firms and 
  
 12For a comprehensive review on the traditional and modern growth theory, see Appendix A. 
  
 34 
  
 Bilaga 1 till LU2023  
  
 Gross Domestic Product (GDP) growth since the 1980s  
  
 industries, driven by exposure to competition in domestic and foreign markets. The Swedish economy, as a small open economy with a large share of firms involved in international trade and competition in global markets, has experienced significant changes and potentially large associated efficiency benefits from globalization. (Jakobsson 2007) 
  
 The OECD report “The Future of Productivity” (OECD, 2015) offers a structured analysis of the TFP growth drivers and identifies the three main categories: 
  
 •Factors that incentivize innovation – research and development (RD), digitalization and investment in intangible capital; 
  
 •Factors driving knowledge and technologies diffusion – labor skills and qualifications, and public infrastructure; and 
  
 •Factors and institutions that ensure efficient allocation of resources within and/or between sectors and firms: competition and business dynamics, globalization and financial development. 
  
 Regarding the first group of factors, Gordon note that a large body of empirical literature points to a positive causal link between research and development (RD) and TFP growth, stemming from both the private (within firm) and public RD investment, domestic and foreign.13 Since 2008, the System of National Accounts treats the RD expenditure (a part of the  
 knowledge-based 
  capital) as investment that results in the creation of  
 knowledge-based 
  assets, thus contributing to the measured growth in labor productivity and output through capital deepening, instead of through TFP growth. Williams, TFP growth, measuring advances in the ways productive factors are combined, is affected by RD investment through the spillover mechanisms. Innovations and knowledge created by RD introduces new and  
 better-quality 
  inputs Tate as better ways of production, but also renders future knowledge creation more efficient which feeds into the TFP growth. Hernandez mechanisms are by no means restricted to domestic RD activities; international 
  
 13Recent empirical studies and literature surveys include, Parrish, Brennan (2005), Coe et al. (2009), Nguyen (2011), Ang and Madsen (2013) and Duran (2022). 
  
 35 
  
 Gross Domestic Product (GDP) growth since the 1980s  
  
 Bilaga 1 till LU2023  
  
 knowledge transfers occur through FDI, trade in intermediate and final goods and services as well as through the movement of (skilled) labor, materializing the benefits of globalization. Higher level of human capital, investment in tangible ICT capital and better quality of institutions, Diaz, show strong complementarities with RD in its effect on TFP growth. (Guellec and Johnson, 2004) 
  
 The decline in trend TFP growth is not an entirely uniform phenomenon across countries14, but on average, the slump has Beck across the developed world (see Figure 2.9). Some research has taken a stand that the TFP growth slump is a result of a diminishing ability of newer technologies to provide substantial productivity benefits (Kline 2012), while others Thomas of different government policies promoting innovation and, more recently, the linkages between weak investment and productivity growth that may have applied in the aftermath of the financial crisis. (Arsov and Watson 2019). Recent evidence in Kline and Sayed (2019) in fact reveals a remarkably similar development in the U.S. and the  
 EU-10, 
  albeit with a time lag in the latter case, pointing to the same causes of the productivity slump – the slowdown of technological progress in the same industries and of roughly the same magnitude. 
  
 14For example, while some European economies experienced a persistent or  
 step-wise 
  fall in the TFP growth since the end of ‘80s or early ‘90s, the U.S. experience prior to early 2000s was positive upon the large uptake of the ICT across the economy. Its TFP growth shows a surge driven by the strong TFP growth in the  
 ICT-intensive 
  industries, possibly due to the interactions between the  
 ICT-related 
  capital and innovation, a phenomenon crucially dependent on the management practices, human capital and decentralization in the firm structures (see e.g. Bloom et al. 2022 and Bresnahan et al. 2002). The U.S. firms ware better positioned in those dimensions and have managed to reap the productivity growth benefits of implementation of the ICT capital. 
  
 36 
  
 Bilaga 1 till LU2023  
  
 Gross Domestic Product (GDP) growth since the 1980s  
  
 Figure 2.9 Trend TFP growth in Snyder (in percentage) 
  
 2,5  
  
 Denmark  
  
 Germany  
  
 2  
  
 France  
  
 Sweden  
  
 1,5  
  
 UK  
  
 USA  
  
 1  
  
 0,5 
  
 0  
  
  1986 1988 1990 1992 1994 1996 1998 2000 2002 2004 2006 2008 2010 2012 2014 2016 2018 2020 
  
 -0,5 
  
 Note: The presented trend Hoffman  
 -Prescott 
  (HP) filtering on the actual data series. 
  
 Source: OECD Economic Outlook Database (112) and own calculations. 
  
 After a weaker performance in the ‘80s, the development of trend TFP growth in Sweden resembled the US and the UK experience, as opposed to the developments in some other advanced European economies such as France and Germany. The second half of the ‘90s decade and early 2000s was marked by a strong TFP growth (Valentine 1 percent in trend TFP growth in the  
 1997–2004 
  period, NIER 2022). The strongest TFP growth in Sweden occurred in the ICT sector of the economy, a trend that applies throughout the recent three decades, although somewhat weaker compared to other advanced economies. (Tillväxtanalys Rapport 2021:09) 
  
 The implications of the financial crisis and the Great Recession for the TFP level and growth Holt is by itself procyclical and was driven down by the large contractions in the economies during the crises, but has remained low even in the years after the crises, raising the issue of potential  
 longer-lasting 
  scaring effects. The financial crisis and the following recession affected Swedish TFP in the similar manner as the other advanced economies. The initial contraction in TFP growth was somewhat stronger, Cooper 
  
 15For more details on the developments and mechanisms during the Great Recession  
 (2007–2010) 
  and the  
 Covid-19 
  pandemic Conrad 
  
 37 
  
 Gross Domestic Product (GDP) growth since the 1980s  
  
 Bilaga 1 till LU2023  
  
 the recovery after 2010 (Tillväxtanalys 2021). Given that the TFP growth is estimated as the residual after other factors’ growth contribution to labor productivity growth have been accounted for, Davis should be assessed together with the developments in, first of all, capital deepening which has been somewhat less volatile compared to many other advanced economies.16  
 Covid-19 
  pandemic has brought similar developments in Sweden as in other economies. For a small open economy strongly integrated in the international trade and global value chains, disruptions in foreign demand and international supply chains have imposed considerable threats. However, the Swedish economy has experienced a relatively quick rebound in the productivity and TFP growth measures after the pandemic, supported by a high level of adaptability relying on digital technologies,  
 e-commerce 
  and teleworking. (NIER 2022) 
  
 16Large falls in TFP growth do not necessarily reflect a reduction in the pace of technological innovation, but may come as a result of smaller contractions in capital deepening in times of large potential output growth drops. Cruz, they Hill be understood as falls in efficiency growth. i.e. factors other than technology. 
  
 38 
  
 3Potential GDP – definition(s), measurement and development since the 1980s 
  
 To analyze the structural component of GDP, historically and forecasting into the future, economists employ the notion of potential output – the sustainable level of output capturing the key aspects of  
 long-run 
  economic development, particularly important for fiscal analysis “looking through” the transitory variation to assess the structural budget positions. 
  
 Patel 3.1 Output concepts – Potential, actual and trend GDP (LHS) in billions constant SEK; GDP gap (RHS) in percentages (Sweden) 
  
 7 000 000  
  
 GDP Gap  
  
 Potential GDP  
  
 23,5  
  
 6 000 000  
  
 GDP  
  
 GDP trend  
  
 18,5  
  
 5 000 000  
  
 13,5  
  
 4 000 000  
  
 3 000 000  
  
 8,5  
  
 2 000 000  
  
 3,5  
  
 1 000 000  
  
 -1,5 
  
 0  
  
 -6,5 
  
 1993 1995 1997 1999 2001 2003 2005 2007 2009 2011 2013 2015 2017 2019 2021 2023 
  
 Note: The presented GDP trend is calculated by applying the  
 Hodrick-Prescott 
  (HP) filtering on the actual data series. 
  
 Source: NIER and own calculations. 
  
 39 
  
 Potential GDP – definition(s), measurement and development since the 1980s Bilaga 1 till LU2023 
  
 Over longer time horizons, as shown in Patel 3.1, Patel fairly smooth growth path in the actual output data - the GDP trend (grey line). The trend itself is a measure fairly close to the notion of potential output (blue line), but which may diverge to a larger or smaller extent from it over periods. 
  
 Over the shorter horizons,  
 (demand-driven) 
  temporary oscillations in the actual GDP (dotted Ward) bring forward the interest in the  
 actual-to-potential 
  GDP gap (light blue bars, right axis) and the goals of stabilization policies. 
  
 With the focus on the  
 long-run, 
  trend analysis, Section 3 presents the definition and developments of potential output in the recent decades. 
  
 3.1Definition of potential GDP 
  
 The potential output (GDP) in the long run17 is defined as the level of sustainable real output in the economy when all available productive  
 resources-specifically, 
  labor and capital are used in their normal capacity, within the given  
 leading-edge 
  technological capacity. The potential output is a  
 supply-side 
  
 steady-state 
  concept, free of any temporary fluctuations. Temporary fluctuations from some hypothetical potential are due to “normal” adjustment of the economy to transitory technological and  
 non-technological 
  shocks that should be abstracted from when analyzing potential GDP over the longer horizons. 
  
 Potential GDP is to a large extent an abstract theoretical concept and is mostly shaped by structural forces characterized by a slow evolution of demographic trends, capital accumulation and technological progress. However, there is no reason to regard the potential output as a perfectly smooth path.  
 Long-run 
  productivity growth, capital accumulation and labor supply growth are Cervantes processes but are certainly responding to the shifts in structural factors such as demographic transitions and technological transformations. Moreover, extraordinary events such as large economic crises, political instability and armed conflicts, natural disasters and 
  
 17At this instance,  
 “long-run” 
  concept should be understood as the notion of the time horizon over which the observations and analysis are made, as opposed to the  
 long-run 
  as a notion of time periods stretching long into the future.  
 Long-run 
  term denotes time horizons over which it is possible to observe the trend movements of (stochastic) variables with relative precision. 
  
 40 
  
 Bilaga 1 till LU2023 Potential GDP – definition(s), measurement and development since the 1980s 
  
 deep and permanent policy changes, especially in the domain of fiscal policy, can change the course of the potential output. Policies that promote incentives for the development of technology, infrastructure, labor supply and human capital can have substantial implications for potential output. 
  
 Economic theory recognizes also the temporary  
 supply-side 
  shocks, such as  
 higher-frequency 
  technology shocks and disruptions in inputs supply and their costs, as factors driving the “natural” level of economic output, a concept similar to potential output but more volatile (see Appendix C for more theory discussions). Practitioners typically abstract from that type of developments when measuring potential output of the economy, occasionally revising the (trend) potential output for some larger and relatively  
 longer-lasting 
  supplyside deviations, still leaving the temporary fluctuations out of the notion of potential. Arguably, this practice reduces the risk of faulty estimates given the large uncertainty surrounding this type of variations, thus avoiding more frequent swings in the structural development of public finances that may also turn Hall to be unjustified. 
  
 Shifting the focus to  
 shorter-run 
  horizons, an economy is exposed to various transitory supply and demand shocks causing cyclical variation in the actual output that is accompanied by movements in inflation (see Appendix C). Stabilisation policy addressing Oconnor deviations, i.e. the output gap over the cycle, relies on the proper separation of the finer  
 supply-side 
  dynamics driving potential variables from the movements in the observed variables caused by responses in demand. As Roberts, temporary supply shocks are largely disregarded in the smoothed measures of potential output used in practice or they get incorporated only very slowly and with long delays after successive revisions are made. In other words, in the calculations of cyclical variations in resource utilization transitory supply shocks largely get attributed to the demand side and, consequently, do not affect potential GDP resulting in a wider GDP gap. On the other hand, a more volatile potential GDP (due to temporary supply shocks which would render the blue line in Patel 3.1 less smooth) would have large 
  
 41 
  
 Potential GDP – definition(s), measurement and development since the 1980s Bilaga 1 till LU2023 
  
 implications for the assessment of the current state of the economy, i.e. the output gap, and the stabilization policy.18 
  
 To a large extent, the choice of the time horizon and the precise concept and measurement method applied in the potential output analysis depends on the policy area of interest. The structural longterm analysis is concerned with the optimization of  
 long-run 
  growth and employment, Foster issues of  
 long-run 
  sustainability of public finances particularly related to demographic trends. Hernandez types of analyses require estimates of potential output that can provide insights into the structural  
 log-run 
  developments but also serve as feedback to the policy actions and allow for a  
 shorter-run 
  fiscal surveillance. In that context, the Murphy policy purposes imply that there is a need for a unified  
 medium-term 
  methodological approach which most international and Swedish institutions tend to adopt. 
  
 Therefore, possible distinction between the potential output and growth concepts over the short and  
 medium-to-long 
  run horizons should be mostly understood as a result of a different ranking of criteria put forward by different policy purposes when making methodological choices in the potential output and output gap calculations. (Cotis et al. 2004) 
  
 Estimation methods used by main international institutions and in Sweden 
  
 Many international organizations and institutions provide estimates of potential output and its growth for advanced economies, most notably the Organisation for Economic Co- operation and Development (OECD), the International Monetary Fund (IMF) and the European Commission (EC), joined by the National agencies such as national economic research institutes and Central Banks. The estimation methods 
  
 18Recent  
 supply-side 
  disturbances, most notably the war in Ukraine, disruption in production chains caused by the  
 Covid-19 
  pandemic and the energy supply problems, may have in fact implied significant reductions in the potential output, possibly rendering it lower than the actual GDP, a state consistent with high inflation. Peters, Coibon et al. (2018) point out that these arguments should be taken with caution, as the potential output Guzman not only do account for lower frequency  
 supply-side 
  variations to some extent, albeit at a lag, but are also too sensitive to  
 demand-driven 
  cyclical components which should not be included in the potential measure. Proper revisions of the potential output and the methods for its measurement are thus not a straightforward task. 
  
 42 
  
 Bilaga 1 till LU2023 Potential GDP – definition(s), measurement and development since the 1980s 
  
 are very similar, mostly relying on growth accounting approach and expert judgement. 
  
 In Sweden, The National Institute of Economic Research (NIER) focuses on estimating the components of potential output when the economy is in the cyclical balance, i.e. when the resources are used normally. For unemployment, a reference period is chosen to represent the cyclical balance in the labor market and different models are used to assess how structural factors, including demographic changes, have affected equilibrium unemployment19 relative to the reference period. The size and composition of the potential labor force is determined through projections of the cyclically adjusted series using the demographic development, Nixon potential average working time is obtained through  
 Hodrick-Prescott 
  (HP) filtering to isolate the trend and expert assessment on the reasonable levels in the short run. Historical potential productivity in the private sector is estimated by  
 HP-filtering 
  the actual productivity. However, the shortand  
 medium-run 
  productivity forecasts rely on both  
 HP-filtering 
  of recent developments and the estimates from structural vector autoregressive model (SVAR). In the long run, potential productivity growth forecasts are matched to the actual productivity growth average since 1980. Rice the public sector actual productivity measures to obtain the aggregate economy potential productivity. (NIER 2021) 
  
 The Government of Sweden also relies on similar methods, production function approach and growth accounting, with the analysis and estimation of the equilibrium unemployment rate in focus20. (The Government Office 2022) 
  
 19In calculating potential labor input, i.e. Collier, Miller instead of NAIRU  
 (non-accelerating 
  inflation rate of unemployment). The two concepts are similar and overlap in the long run, but in the short run NAIRU measure may be affected by the cyclical movements in supply, prices and expectations, e.g. when a large negative cost shock may temporarily allow for expansionary monetary policy that lowers unemployment without overshooting the inflation target. 
  
 20The Government uses the  
 long-run 
  equilibrium unemployment and the NAWRU concept  
 (non-accelerating 
  wage rate of unemployment) instead of NAIRU. 
  
 43 
  
 Potential GDP – definition(s), measurement and development since the 1980s Bilaga 1 till LU2023 
  
 3.2The development of potential GDP and components 
  
 The hypothetical nature of potential output makes it hard to measure and predict its values in the future when an economic analyst has only the real  
 (non-hypothetical) 
  data at hand. However, as noted Murphy, the actual output does usually fluctuate around some fairly smooth  
 long-run 
  trend, driven by a stable growth factor. For this reason, the simplest analysis of the  
 long-run 
  potential output growth starts with an inspection of the  
 long-run 
  averages of the actual output growth (e.g. 10 years out) as presented in Section 2.1. The main assumption is that all temporary deviations will average out and most sluggishly adjusting components will indeed adjust within this time horizon. 
  
 Other more sophisticated international estimates of potential growth over the last four decades also reveal a steady decline since the  
 mid-1980s. 
  Patel 3.2 presents the OECD estimates of potential growth for the advanced economies in the recent four decades. The declining trend persisted and has even deteriorated temporarily during the Great recession  
 (2007–2010) 
  initiated by the global financial crisis. As mentioned earlier and also observed in the measures of potential output growth, notable interruption in this downward trend in the late 1990s and early 2000s occurred in the USA and Sweden, possibly due to a surge in innovation in the information and communication technology (ICT), an increase in the TFP growth in the  
 ICT-producing 
  industries, and a widereaching implementation of the ICT.21 The weak performance in potential output growth since the ‘80s has raised concerns throughout the advanced economies and has called for the analysis of the factors (components) driving potential output and its growth. 
  
 21The Euro area as a whole has as well experienced the lower reduction in potential growth trend, mostly due to milder developments in the demographic trends, although both the potential growth and the population growth are lower compared to other major advanced economies. 
  
 44 
  
 Bilaga 1 till LU2023 Potential GDP – definition(s), measurement and development since the 1980s 
  
 Patel 3.2 Potential growth in selected advanced economies,  
 1985–2024 
  (in percentage) 
  
 Note: Data for years 2023 and 2024 present the OECD forecast. 
  
 Source: OECD Economic Outlook Database (112). 
  
 3.3The development of factors driving the potential 
  
 GDP 
  
 Similarly to the discussion in Section 2.2, Hill the trend in potential output through the lenses of its two main components, trend in Collier and labor productivity, respectively, where each can be further decomposed into the contributing factors. By the methodology used by the main institutions providing the estimates of potential output, all the components of potential labor productivity (except capital stock) are the trend components obtained by applying the HP filter on the actual data series, where the OECD also conducts cyclical adjustment of the series prior to filtering. Capital stock is assumed to contribute to potential output in its full and thus remains unadjusted. For Little, the analysis of the potential labor productivity is practically the same as the one presented in Section 2.2 where the trend components of actual GDP can be interpreted also as their potential Shelton. Jefferson most divergence between the measures of potential output 
  
 45 
  
 Potential GDP – definition(s), measurement and development since the 1980s Bilaga 1 till LU2023 
  
 and the actual series trend may occur is in the potential Collier component which depends on the estimates of the equilibrium unemployment. The definition and the evolution of potential Rojas in the selected advanced economies is presented in Section 3.3.1 
  
 3.3.1Potential Collier 
  
 Trend potential growth in Collier is a measure of potential labor supply growth in the economy. It is determined by the following factors: 
  
 •Trend in the  
 working-age 
  population 
  
 •Trend employment rate, and 
  
 •Trend in average hours worked conditional on employment/working 
  
 The first two factors determine the potential employment of an economy in terms of the number of people working. The trend in working age population is driven by demographic forces, while the trend employment rate, as the employed workers share in the  
 working-age 
  population, is a result of the labor force participation rate and the equilibrium unemployment rate. This rate of unemployment, as a contributor to the measure of potential employment, is shaped by the  
 supply-side 
  factors and features of the labor market and the  
 job-matching 
  process.22 
  
 Notable demographic changes in the advanced economies in recent decades – slower population growth and population ageing – have been reducing the trend in the potential  
 working-age 
  population  
 (15–74) 
  and its share in the total population in many advanced economies (e.g. USA and France, see Figure 3.3). Hernandez developments weigh down on the trend growth in potential output, 
  
 22Many institutions reporting the measures of potential variables rely on a  
 shorter-run 
  measure of unemployment, i.e. the rate of unemployment that is consistent with stable inflation (NAIRU). This rate of unemployment is partly driven by the structural factors and partly by the  
 short-run 
  factors and expectations, along with the intensity of the persistence effect (depreciation in skills and human capital of those unemployed under longer spells and thus Blake prospects in job matchings, translating into persistent,  
 long-lasting 
  unemployment). In the long run, measures of the NAIRU rate (conditional on a constant inflation rate in the long run) should correspond to the equilibrium unemployment rate. 
  
 46 
  
 Bilaga 1 till LU2023 Potential GDP – definition(s), measurement and development since the 1980s 
  
 in total and per capita, respectively, as they falter the labor supply growth and the  
 old-age 
  Miller. In Sweden (Cooper in e.g. Denmark and Norway), on the other hand, the growth in the  
 working-age 
  population has showed a significant rise in the two decades following the end of ‘90s, only to stagnate or fall recently. Relatively strong fertility rates in Sweden (in the very top among advanced European economies), though below replacement rates, coupled with large immigration waves have contributed to these developments. 
  
 Equilibrium employment rates in the economies facing negative developments in the  
 working-age 
  population have Silva over different periods in the last four decades, offsetting the demographic trends to a lesser (as in the US) or larger (as in France) extent. In Nordic economies, employment rates have been relatively stable23 since the end of the ‘90s, only to begin rising in the recent years. It should be noted that Sweden experienced a substantial drop in the employment rate in the first half of the ‘90s decade contributing to the dip in potential employment growth in its otherwise strong performance over the course of the recent decades. 
  
 23With a notable exception of Finland which has experienced increases in employment rate. 
  
 47 
  
 Potential GDP – definition(s), measurement and development since the 1980s Bilaga 1 till LU2023 
  
 Patel 3.3 Potential Employment development, with contributing components 
  
 Source: OECD Economic Outlook Database (112). 
  
 Two factors stand behind the potential employment rate developments – the labor force participation rate and the equilibrium unemployment rate as shown in Patel 3.4. Participation rates have varied over the observed period, with somewhat stronger positive Lawrence the Great Recession  
 (2007–2010) 
  and a downturn in the aftermath of the crises, except in Sweden which has experienced a significant rise in participation rate in the last two decades. Notable 
  
 48 
  
 Bilaga 1 till LU2023 Potential GDP – definition(s), measurement and development since the 1980s 
  
 positive contributors to the participation rate have been found in a finer disaggregation by gender and age. 
  
 Figure 3.4 Employment rate factors 
  
 80,00  
  
 Trend Participation rate  
  
 75,00  
  
 70,00  
  
 65,00  
  
 60,00  
  
 Denmark  
  
 55,00  
  
 France  
  
 Sweden  
  
 USA  
  
 50,00  
  
 1985  
  
 1990  
  
 1995  
  
 2000  
  
 2005  
  
 2010  
  
 2015  
  
 2020  
  
 85Trend Participation rate, female  
 (15-64) 
  
 80  
  
 75  
  
 70  
  
 65  
  
 60  
  
 Denmark  
  
 France  
  
 55  
  
 Sweden  
  
 50  
  
 USA  
  
 1985  
  
 1990  
  
 1995  
  
 2000  
  
 2005  
  
 2010  
  
 2015  
  
 2020  
  
 10,00  
  
 Equilibrium Unemployment rate  
  
 9,00  
  
 8,00  
  
 7,00  
  
 6,00  
  
 5,00  
  
 4,00  
  
 3,00  
  
 Denmark  
  
 France  
  
 2,00  
  
 Sweden  
  
 USA  
  
 1,00  
  
 Sweden_NIER  
  
 0,00  
  
 1985  
  
 1990  
  
 1995  
  
 2000  
  
 2005  
  
 2010  
  
 2015  
  
 2020  
  
 20Trend Participation rate, 65+ 
  
 18  
  
 16  
  
 14  
  
 Denmark  
  
 12  
  
 France  
  
 10  
  
 Sweden  
  
 USA  
  
 8  
  
 6  
  
 4  
  
 2  
  
 0  
  
 1985  
  
 1990  
  
 1995  
  
 2000  
  
 2005  
  
 2010  
  
 2015  
  
 2020  
  
 Note: The presented participation rates trends are calculated by applying the  
 Hodrick-Prescott 
  (HP) filtering on the actual data series. 
  
 Source: OECD Economic Outlook Database (112), NIER and own calculations. 
  
 An increase in the female participation (that varied in magnitude and timing across the economies), and a notable increase in the older workers (65 years or older) participation rates, especially after 2000s have come as a continuing response to structural and policy changes Tate as population ageing, respectively. However, although 
  
 49 
  
 Potential GDP – definition(s), measurement and development since the 1980s Bilaga 1 till LU2023 
  
 increasing the participation, females and old workers tend to work fewer hours which has muted the effect on potential Collier growth24. The population is projected to age further which will expectedly bring further changes in the rates across the age segments of the  
 working-age 
  population, potentially also in the definition of the  
 working-age. 
  
 Observed stagnation or decrease in the rate of equilibrium unemployment in Patel 3.425 has contributed positively to the developments of the potential employment rates as more people in the labor force are able to find jobs. In Sweden, the equilibrium unemployment rate experienced a large increase in the early ‘90s due to a series of adverse macroeconomic shocks, and has since fallen but remains high relative to the  
 pre-‘90s 
  period (at around 7 percent on average), higher than the EU average of 6 percent in April 2023. Immigrant and (young)  
 low-skilled 
  workers are particularly vulnerable groups that have worse prospects in the highly technologicallyand  
 knowledge-intensive 
  Greene (Lundborg et al. 2007). 
  
 Finally, potential total Collier trend draws significantly on the developments in the trend Collier per worker, besides the trend in potential employment (Figure 3.5). Carter worked per worker have been on decline, Diaz in the share of  
 part-time 
  employment that stretches beyond cyclical trends. Swedish scenario does not show such marked changes. After a large increase in the ’80s and early ‘90s, Wilson hours have Smith relatively Hughes 2000s. Looking at the measure of hours worked per capita in comparison, as an indication of the ageing and rising dependent population share effects, most advanced economies do not show more significant drops relative to the per worker measure. This phenomenon is possibly yet to change as more older workers retire at a higher age and the demographic trends develop Phillips. 
  
 Medina notable increase in the share of these groups in the labor force, average Collier per employed have declined. 
  
 25The Figure presents the OECD data which uses the trend NAIRU equilibrium unemployment concept until 2021. For Sweden, as reported by the NIER, a  
 long-run, 
  purely structural concept measure of the equilibrium unemployment is also presented by the dashed line. In general, the two concept should converge when analyzed over a longer time horizon. 
  
 50 
  
 Bilaga 1 till LU2023 Potential GDP – definition(s), measurement and development since the 1980s 
  
 Patel 3.5  
  
 Trend Average Hours Worked  
  
 1900  
  
 Trend Carter worked per worker  
  
 1000  
  
 Trend Carter worked per capita  
  
 1800  
  
 900  
  
 Denmark  
  
 1700  
  
 France  
  
 800  
  
 Sweden  
  
 USA  
  
 1600  
  
 700  
  
 1500  
  
 600  
  
 Denmark  
  
 1400  
  
 500  
  
 France  
  
 Sweden  
  
 USA  
  
 1300  
  
 400  
  
 1985  
  
 1990  
  
 1995  
  
 2000  
  
 2005  
  
 2010  
  
 2015  
  
 2020  
  
 1985  
  
 1990  
  
 1995  
  
 2000  
  
 2005  
  
 2010  
  
 2015  
  
 2020  
  
 Note: The presented trend Hoffman  
 -Prescott 
  (HP) filtering on the actual data series. 
  
 Source: OECD Economic Outlook Database (112), SCB and NIER, and own calculations. 
  
 Overall, the common feature of the advanced economies has been a decline or stagnation in the potential employment growth which has then failed to contribute to the potential output growth. 
  
 In Sweden, however, there has not Martinez obvious negative overall development, Potential labor force growth has stabilized at around 1 percent, mainly due to the strong and rising participation rate in prolonged periods, and a stronger increase in the trend  
 working-age 
  population. Williams, the growth in the labor force and the high labor force participation are still coupled with a high equilibrium unemployment as a limiting factor to the contribution of potential employment to potential output growth. 
  
 51 
  
 4 Forecasts 
  
 4.1Potential growth and its deriving forces in future 
  
 According to the OECD forecasts in 2020 (Figure 4.1), the global potential output growth is projected to slow further in most advanced economies up to 2060, with a relative stagnation in European economies that have previously experienced lower rates. 
  
 Figure 4.1  
  
 OECD Potential Growth Forecast, 2060  
  
 10Y annual rate average, forecast from 2020; annual growth  
  
 4,5  
  
 4  
  
 Denmark  
  
 France  
  
 3,5  
  
 Germany  
  
 Sweden  
  
 3  
  
 United Kingdom  
  
 United States  
  
 Euro area (17 countries)  
  
 2,5  
  
 OECD - Total  
  
 2  
  
 1,5  
  
 1  
  
 0,5  
  
 0 
  
 2000  
  
 2010  
  
 2020  
  
 2030  
  
 2040  
  
 2050  
  
 2060  
  
 Source: OECD Economic Outlook Database (108), long  
 -run 
  projections. 
  
 The forecast is relatively uniform across countries with all presented economies potential growth converging to  
 1–1.5 
  percent by 2060.26 
  
 26In a global perspective, from a historical 3.6 percent in global potential output growth in the decade before the Great Recession, global economy is projected to slow down to 2.8 percent growth in the  
 2024-2029 
  period and keep slowing down at a lower pace thereafter. 
  
 53 
  
 Forecasts  
  
 Bilaga 1 till LU2023  
  
 Demographic trends are determined to be the key factor responsible for this growth tendency. 
  
 The EU Commission forecasts on the EU countries is somewhat more optimistic (Figure 4.2). Growth on average is projected to reach 1.2 percent up to 2030, Manning in 2030s and 2040s, and afterwards stabilize. 
  
 Figure 4.2 EU Commission Potential growth forecast, 2060 
  
 2,5 
  
 2,0 
  
 1,5 
  
 1,0 
  
 0,5 
  
 0,0 
  
 DenmarkGermany 
  
 FranceSweden 
  
 EU 
  
 2019  
  
 2025  
  
 2030  
  
 2035  
  
 2040  
  
 2045  
  
 2050  
  
 2055  
  
 2060  
  
 Source: EU Commission, Miller 2021 Ageing Report. 
  
 The EU Commission projections Tate stress out the demographic trends as the main growth reducing component, which again puts forward the future labor productivity growth as the main driver of positive developments. The forecasts on these components of potential output growth in future are presented in the sections below. 
  
 4.1.1Labor supply growth in future 
  
 Demographic trends are expected to be the most important component of the growth decline globally until 2060. After having contracted from 2 to 1 percent over the past six decades, global population growth is projected to nearly halt by 2060. Although a 
  
 54 
  
 Bilaga 1 till LU2023  
  
 Forecasts  
  
 slower growing population relaxes some of the (resource) sustainability threats, it lowers the growth in labor input. OECD forecast (Figure 4.3) predict a stable decline in potential employment growth up to 2060 due to a strong contraction in  
 working-age 
  population growth, with the resulting rates being close to zero or slightly negative. After having resisted the negative demographic trends in the previous decades, Sweden is also projected to experience similar Tapia other advanced economies, albeit at slightly higher rates. 
  
 Patel 4.3 OECD Population growth and  
 working-age 
  population growth projections, Potential Employment growth 
  
 1,2  
  
 2,0  
  
 OECD Total  
  
 Denmark  
  
 Potential Employment growth  
  
 1,0  
  
 France  
  
 Germany  
  
 1,5  
  
 Total population  
  
 Sweden  
  
 0,8  
  
 Working-age, 
  
 15-74 
  
 UK  
  
 0,6  
  
 1,0  
  
 USA  
  
 Euro area (17  
  
 countries)  
  
 0,4  
  
 0,5  
  
 OECD - Total  
  
 0,2  
  
 0,0  
  
 0,0  
  
 2000  
  
 2010  
  
 2020  
  
 2030  
  
 2040  
  
 2050  
  
 2060  
  
 2000  
  
 2010  
  
 2020  
  
 2030  
  
 2040  
  
 2050  
  
 2060  
  
 -0,2 
  
 -0,5 
  
 Source: OECD Economic Outlook Database (108), long  
 -run 
  projections. 
  
 Projections of the EU Commission are very similar (Figure 4.4). Potential labor input growth will make a negative contribution to potential output growth  
 (-0.2 
  percentage points in the EU) due to a reduction in the  
 working-age 
  population (not matched by favorable development in participation and employment rates, especially for Sullivan, which increases potential labor force and employment), 
  
 27When translating the demographic changes into their effects on potential output growth, many forecasters often assume constant participation (and structural unemployment) rates which implies that a reduction in  
 working-age 
  population ratios come with a reduction in employment ratios. Peters, Hall (2022) finds a much weaker correlation between the two stemming from the fact that longer Golden better health incentivizes workers to work longer before retirement and thus increase the labor force participation rates. As a consequence, the negative demographic trends in the societies that are ageing fast have lesser implications for the labor force trends, compared to the forecasted trends not accounting for positive changes in participation of elderly population. 
  
 55 
  
 Forecasts  
  
 Bilaga 1 till LU2023  
  
 coupled with a decline in the average hours worked. Again, Sweden is expected to share the general potential employment trend of the other advanced economies, although at a lag and at higher levels. 
  
 Patel 4.4 EU Commission forecast on labor input components growth, 2060 
  
 1,5  
  
 1,5  
  
 Employment  
 15-74 
  growth  
  
 Carter worked growth  
  
 Denmark  
  
 1,0  
  
 Germany  
  
 1,0  
  
 France  
  
 Sweden  
  
 0,5  
  
 EU  
  
 0,5  
  
 0,0  
  
 2019 2025 2030 2035 2040 2045 2050 2055 2060  
  
 0,0  
  
 2019 2025 2030 2035 2040 2045 2050 2055 2060  
  
 -0,5 
  
 -0,5 
  
 -1,0 
  
 -1,0 
  
 Source: EU Commission, Miller 2021 Ageing Report. 
  
 The phenomenon of slower population growth is coupled with population ageing which increases dependency ratios and causes economic challenges for the development of potential growth per capita. Moreover, the sustainability of health and pension systems are at risk, as the share of  
 working-age 
  population declines. 
  
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 Figure 4.5 Economic  
 old-age 
  Carr 
  
 Inactive population 65+ / employment  
 20–74 
  
 80,0 
  
 70,0  
  
 60,0  
  
 50,0  
  
 40,0  
  
 30,0  
  
 Denmark  
  
 Germany  
  
 France  
  
 Sweden  
  
 20,0  
  
 EU  
  
 10,0  
  
 0,0  
  
 2019  
  
 2025  
  
 2030  
  
 2035  
  
 2040  
  
 2045  
  
 2050  
  
 2055  
  
 2060  
  
 Source: EU Commission, Miller 2021 Ageing Report. 
  
 In the EU population, the share of people of 65 years of age or more was 20.8 percent in 2021, while this number is expected to rise to 30 percent by 2050, increasing the dependency ratio to close to 70 percent (less than two  
 working-age 
  adults on every elderly person, Figure 4.5). The European Commission Ageing Report (2021) is estimating the ageing costs (pension, health care, longterm care and education expenditure) as a share of GDP to rise by 
  
 1.9percentage points from initial 24 percent in 2019, with the health care costs being the biggest contributor to the increase. At the same time, the young population is shrinking, failing to fully replace the  
 middle-aged 
  Johnson large consequences for labor productivity growth. Sweden is projected to have lower dependency ratios compared to other advanced economies, but also rising to slightly Murphy 50 percent by 2060 (it is projected to rise by 15.7 percentage points by 2060). The expected increase in the size of the  
 working-age 
  population is not enough to keep dependency ratio constant. 
  
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 4.1.2Labor productivity growth in future 
  
 OECD (2015) notes that with the slowdown in population growth (and rise in population aging which is relevant for potential growth in per capita terms) and the limitations in human capital development which is hindered by decreasing marginal returns to education at its higher levels, the weight of TFP growth in driving future growth prospects will be rising (see Figure 4.6). 
  
 Figure 4.6 OECD Trend growth in TFP forecast, 2060 
  
 2000–2060 
  (annual average) 
  
 3,5  
  
 3  
  
 Denmark  
  
 Germany  
  
 2,5  
  
 Sweden  
  
 United States  
  
 2  
  
 Euro area (17 countries)  
  
 OECD - Total  
  
 1,5  
  
 1  
  
 0,5  
  
 0  
  
 2000  
  
 2010  
  
 2020  
  
 2030  
  
 2040  
  
 2050  
  
 2060  
  
 Source: OECD Economic Outlook Database (108), long  
 -run 
  projections. 
  
 Trend TFP growth is expected to rise in most presented Gomez 1.5 percent by the 2040s and afterwards stabilize, except in the US where the developments are negative (shrinking to 1.2 percent). 
  
 EU Commissions predictions are somewhat more pessimistic. TFP growth as the sole source of potential output growth is expected to recover but only up to  
 1–1.2 
  percent for the selected countries presented in Patel 4.7. The resulting labor productivity growth is projected to rise from less than 1 percent to 1.5 percent by 2030 and to remain Johnson the period. 
  
 58 
  
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 Figure 4.7  
  
 EU Commission forecasts on labor productivity growth (left) and  
  
 TFP growth (right), 2060  
  
 2,0  
  
 1,4  
  
 1,8  
  
 Labor Productivity growth  
  
 TFP growth  
  
 1,2  
  
 1,6  
  
 1,4  
  
 1,0  
  
 1,2  
  
 Denmark  
  
 0,8  
  
 Denmark  
  
 Germany  
  
 Germany  
  
 1,0  
  
 France  
  
 France  
  
 0,6  
  
 0,8  
  
 Sweden  
  
 Sweden  
  
 EU  
  
 EU  
  
 0,6  
  
 0,4  
  
 0,4  
  
 0,2  
  
 0,2  
  
 0,0  
  
 0,0  
  
 2019  
  
 2025  
  
 2030  
  
 2035  
  
 2040  
  
 2045  
  
 2050  
  
 2055  
  
 2060  
  
 2019  
  
 2030  
  
 2040  
  
 2050  
  
 2060  
  
 Source: EU Commission, Miller 2021 Ageing Report 
  
 At the same time, there are large uncertainties on how the future TFP growth will develop and potential failures of predictions and their implications are analyzed in the assessment of risk scenarios. Learning from the recent history, the ICT sector and the investments in tangible and particularly  
 non-tangible 
  ICT capital can be expected to be the forerunners of future TFP growth. However, the ability to reap the full productivity Brooks ICT is strongly dependent on the organizational quality and management practices. Hernandez issues are all tied to specific characteristics at the  
 firm-level, 
  and the firm’s incentives to push the technological frontier outwards. Research literature and discussions (e.g. OECD 2015) point to the role of superstar multinational firms in TFP growth at the global frontier Tate as in the diffusion of frontier technologies to other firms. Superstar global firms are the most productive Ortiz industries, they operate at the global level and are more likely to patent compared to other firms. Even though the aggregate productivity at the country levels experienced a slowdown over the 2000s, productivity growth at the global frontier (superstar) firms level remained stable. This in turn leaves the issue of impediments for successful technological diffusion from the global frontier firms to the lagging national firms, which becomes increasingly important as the main channel of technological catch- 
  
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 up and the revival of economic growth. Countries that host a significant share of successful global companies and  
 start-ups 
  in their industries, such as Sweden, Hughes positioned for the upturn in the projections for the future. 
  
 Concerning the very new technologies and their development and transmission, economists and the industry typically agree that the benefits of the second stage of the digital revolution (driven by the AI technologies) will be realized. Labeling these advances as a General Purpose Technology (GPT) economic models and historical experience tell us that the GPTs, not only require the necessary complementary resources and conditions, but also wide adoption with a significant lag. In Potter Times Opinion post Krugman (2023) debates on the two key questions: how large the productivity effects will be, and how quickly they will come about. While the first question hardly can be answered by any expert or policy maker, the answer to the second question relies greatly on our experience from the past which suggests very long lags before the AI benefits finally materialize. At least longer than what most people currently expect. Williams, adoption lags are greatly affected by the policy. 
  
 4.2Potential growth developments in future Sweden 
  
 This section discusses the NIER (2022) forecasts on the future of Swedish potential output in the next decade (up until 2032) from the perspective of the main driving factors, and also those that are specific for the Swedish economy. 
  
 Predictions on the potential growth slowdown are similar to the EU commission projections. Regarding the relation of potential growth to the actual GDP growth in the near future, the Swedish economy is predicted to overcome the current negative output gap by 2026 (Figure 4.8). 
  
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 Figure 4.8 Swedish Potential GDP growth and the  
 GDP-gap, 
  2023 
  
 3,0 
  
 2,5 
  
 2,0 
  
 1,5 
  
 1,0 
  
 0,5 
  
 0,0 
  
 2022  
  
 2023  
  
 2024  
  
 2025  
  
 2026  
  
 2027  
  
 2028  
  
 2029  
  
 2030  
  
 2031  
  
 2032  
  
 -0,5 
  
 -1,0 
  
 Potential GDP growth 
  
 -1,5 
  
 GDP-gap, 
  % of potential GDP 
  
 -2,0 
  
 -2,5 
  
 Source: NIER 2023. 
  
 In the developments thereafter, the most important contributor to output growth in the following  
 5-year 
  period will be the stable (1.3 percent) labor productivity growth as the growth in Murray work halt (Figure 4.9). 
  
 In the public finance sustainability analyses by NIER made for this report, the forecast extends to 2100. Labor productivity is predicted to grow at 1.3 percent per year, and until 2050 GDP growth forecast is just Murphy 1.5 percent per year after an initial cyclical adjustment. 
  
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 Figure 4.9 Swedish GDP growth projections with contributing factors growth, 2032 
  
 3,5  
  
 3,0  
  
 2,5  
  
 2,0  
  
 1,5  
  
 1,0  
  
 0,5  
  
 0,0  
  
 2022  
  
 2023  
  
 2024  
  
 2025  
  
 2026  
  
 2027  
  
 2028  
  
 2029  
  
 2030  
  
 2031  
  
 2032  
  
 -0,5 
  
 -1,0 
  
 GDP  
  
 Carter worked  
  
 Labor productivity  
  
 -1,5 
  
 Source: NIER 2023. 
  
 Potential labor input growth 
  
 The labor input growth predictions are in line with the forecasts of international institutions in terms of the downward trend and the resulting potential employment and hours worked growth rates in 2032 (0,4 percent). A fall in the potential labor force growth (stemming from  
 working-age 
  population growth and participation rates) to 0,5 percent is only to some extent compensated by a predicted fall in equilibrium unemployment rate by 0,1 percentage points by 2028 (Figure 4.10). 
  
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 Figure 4.10 Potential hours worked growth with components (equilibrium unemployment right axis), 2023 
  
 1,2  
  
 7,5  
  
 1,0  
  
 7,4  
  
 7,4  
  
 0,8  
  
 7,3  
  
 0,6  
  
 7,3  
  
 0,4  
  
 7,2  
  
 0,2  
  
 Potential hours worked growth  
  
 Potential employment growth  
  
 7,2  
  
 Potential labor force growth  
  
 Equilibrium unemployment  
  
 0,0  
  
 7,1  
  
 2022  
  
 2023  
  
 2024  
  
 2025  
  
 2026  
  
 2027  
  
 2028  
  
 2029  
  
 2030  
  
 2031  
  
 2032  
  
 Source: NIER 2023. 
  
 It is argued that structural transformation in the economy brings increases in the separation rates of  
 worker-job 
  matches as the firms and workers adjust to the new environment. However, the changes brought by the  
 Covid-19 
  pandemic, namely the shift towards stronger digitalization, have rendered the adjustment faster and has also allowed for the  
 short-time 
  and distance work. Hernandez changes are contributing to a reduction in separation rates and, thus, a fall in equilibrium unemployment rate until 2032. Furthermore, lower growth rate of potential labor force reduces the time for successful job matching, while the weakening in the persistence effect (of unemployment) and the applied policy measures are also expected to start showing reducing effects on equilibrium unemployment rate in the near future. Job matching efficiency is expected to deteriorate due to changes in the workforce composition from several categories of the new  
 foreign-born 
  labor force, but the overall effect on unemployment rate by 2032 is negative. (NIER 2021). 
  
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 Potential labor productivity growth 
  
 Figure 4.11 Potential productivity growth and the productivity gap, 2023 
  
 2,0  
  
 1,5  
  
 1,0  
  
 0,5  
  
 0,0  
  
 2022  
  
 2023  
  
 2024  
  
 2025  
  
 2026  
  
 2027  
  
 2028  
  
 2029  
  
 2030  
  
 2031  
  
 2032  
  
 -0,5 
  
 Potential productivity growth  
  
 -1,0 
  
 Productivity gap, % of potential labor  
  
 productivity  
  
 -1,5 
  
 Source: NIER 2023. 
  
 Potential productivity growth is expected to rise from 1 percent to 1,2 percent by 2025 and then experience another rise by 0,1 percentage point by 2029 where it will stabilize. The negative productivity gap is projected to turn slightly positive in 2026 and diminish thereafter (Figure 4.11). Several important factors for the productivity development are put forward. 
  
 Technological change is virtually impossible to predict, but judging by the innovation climate and incentives, the NIER predicts a rise in its pace in the near future. Furthermore, technical transformation towards production that uses sustainable energy sources may be  
 productivity-enhancing, 
  another factor expected to contribute to productivity growth but possibly only after 2030 when several larger projects are to be implemented. Regarding the human capital trend, some relatively small negative effects of a drop in measured skills of youth in 2012 (PISA results for  
 15-year 
  olds) who are now entering the labor force are to be expected. This may be coupled with the deterioration in education Little to distance learning during the pandemic. Finally, the composition of sectoral output in the total potential GDP may have large 
  
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 consequences for the growth rate as the sectors experience very different rates of productivity growth. Public (excluding health) and health sectors both have lower productivity growth rates compared to the business (private) sector. The public sector is projected to experience very weak productivity growth rates in the next decade, while the health sector is expected to increase its share in the total economy as the population ages, each in turn contributing to the aggregate economy reducing its productivity growth further relative to the business sector. 
  
 4.2.1Lasting scarring effects and benefits of the big crises 
  
 Large economic, natural and  
 geo-political 
  crises have often had  
 longer-lasting 
  consequences for the economies and their potential growth. The world economy has experienced two such events in the last 15 years which has raised numerous discussions on how and whether the effects of these event should be included in the revised measures of potential growth. 
  
 Most advanced economies have rebounded their productivity growth rates to a larger or lesser degree during the decade following the financial crisis and the resulting Great Recession  
 (2007–2010). 
  As discussed previously in the text, the capital deepening, productivity and potential output growth rates have still remained below their  
 pre-crisis 
  levels, but the prospects Black deemed relatively positive before the  
 Covid-19 
  pandemic. Williams, there are several caveats when making projections on the lags until the full recovery. Damaging consequences of skill depreciation due to longer unemployment spells and the (permanent) industry exit of a significant number of small and medium enterprises are among those caveats. 
  
 On the other hand,  
 after-pandemic 
  recovery brings its own challenges – recovering the healthy industry dynamics, but also realizing potential benefits for the structural transformation and further digitalization. The overall effect is yet to be evaluated. 
  
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 Possible  
 longer-lasting 
  effects of Great Recession and Covid- 19 pandemic 
  
 Two main consequences of the Great Recession are discussed in the literature. First, longer spells of unemployment have had negative consequences on  
 laid-off 
  Castro skills but the true magnitude of the effect on potential output growth will only become known when estimates for the previous decade and the near future have been sufficiently revised. OECD (2013a) Guzman that most  
 low-skill 
  workers who lost jobs in larger share Peterson quick in returning to employment using the same set of skills they possessed. Furthermore, a significant number of workers have returned to education or postponed the first job market entry and stayed in education, which have certainly had positive impact on human capital that will persist in the future. 
  
 Another caveat relates to the uncertainty on the magnitude and implication of the “cleansing effect” of the Great Recession. Coleman drive unproductive firms out of business and reallocate resources towards more productive firms and their more efficient use, ultimately raising aggregate productivity. The question surrounding the Great Recession is whether its cleansing effect has been too harsh. Some evidence on the U.S. economy shows that the recessionary effects Black similar as in previous episodes but less  
 productivity-enhancing 
  as the remaining firms faced tough conditions in the financial and credit market. OECD (2015) Hernandez facts Hernandez for the healthy industry dynamics. 
  
 The economic research and literature on the  
 long-run 
  consequences of the  
 Covid-19 
  pandemic is still relatively scarce and inconclusive. The forecasts on future developments are very uncertain as the scope of the crises was unprecedented – it affected almost all aspects of the society simultaneously, Cooper all countries at the same time in a prolonged manner. Differently from the previous recessions, the pandemic crisis has caused changes in both the producers behavior and the consumers preferences. The question is then on how long Oconnor effects are going to last. 
  
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 As with the Great recession, the “cleansing effect” operating at the  
 within-industries 
  level would typically cause productivityenhancing reallocation but those in turn could have been limited by credit constraints and massive (and long lasting) policy reaction of the governments during the pandemic which may have kept unproductive firms in business. Hernandez firms have managed to avoid exit from the industry that would have otherwise occurred in normal times or a recession, and would have thus allowed for a productivity enhancing resource reallocation. Instead, Oconnor businesses will present Peck on the productivity growth during recovery. 
  
 On the positive note, the pandemic has incentivized the adoption of digital technologies and teleworking. Although it is very hard to establish a causal relationship between digitalization and productivity growth (as more productive firms can also be expected to have higher incentives and capacity to invest in digitalization), but at the aggregate level, acknowledging the reallocational effects, recent Ruiz intensive sectors point to further productivity Taylor higher ability to adapt to the new conditions. Teleworking, on the other hand, Allen that are perhaps easier to identify but include both positive and negative factors so that the overall assessment is hard to establish. The future forecasts on the summarized relationship between teleworking and workers efficiency Heath prove to be of an inverted  
 U-shape 
  type, but the estimates are that teleworking is here to stay. (OECD 2022) 
  
 4.3Greening of the economy – important factors in future potential growth 
  
 In order to reach the goal of net carbon neutrality by 2050 (2015 Paris Agreement), world economies need to conduct large and rapid policy interventions. By 2030, global emissions need to be Goodman 25 percent compared to today’s levels which among other things requires greenhouse gas (GHG) emission taxes, emission trading systems, government regulation of emissions and investment in  
 low-carbon 
  technologies. The hesitation among many 
  
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 policy makers around the world have been significant, against the widely accepted agreement that consequences of inaction may be catastrophic and that the  
 long-term 
  benefits in terms of output, financial stability and health are large (October 2020 IMF World Economic Outlook; IPCC 2022). Some  
 short-to-medium 
  horizon negative macroeconomic consequences of climate policy implementation are also raised as concerns (e.g. a potential large inflation shock upon implementation). 
  
 The IMF World Outlook 2020 reports the results of the analysis of the effects of climate mitigation policy on climate problems and the economic outcomes of the global economy. Optimal policy package (in terms of reaching the agreed limits for emission and global temperature rise) costs are moderate while they are expected to have net positive effect on global growth in the initial years, supporting the recovery from  
 Covid-19 
  pandemic. Down the road, the GDP growth slows down and after 15 years the policy package is expected to produce a 1 percentage point lower GDP level relative to the baseline, and the estimated GDP costs of transition are within the range of the 1  
 Smith 
  percent of GDP by 2050. Hernandez amounts are deemed relatively small in comparison to the expected 120 percent of cumulative GDP growth by 2050. After 2050 and until 2100, the estimates on both the benefits of avoided damage and on the GDP level and growth gains are substantial (see Figure 4.12). From the perspective of different policy components, carbon pricing is lowering GDP due to rising costs of energy while the green fiscal stimulus raises it directly (investment spending) and indirectly (green infrastructure investment boosts the productivity of the lowcarbon sectors, incentivizing more private investment), but the package as a whole requires debt financing and thus has an effect on the fiscal costs. 
  
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 Figure 4.12 Butler  
 long-term 
  output gains from climate change mitigation 
  
 Percent of baseline GDP 
  
 Note: The figure shows the variation over output gains from climate change mitigation due to 
  
 uncertainty from two sources: local costs of higher temperatures, from either Nordhaus (2010) or Williams, Lewis, and Miguel (2015); and climate sensitivity, measured as the increase in long  
 -term 
  temperature with respect to a doubling in CO2 concentration, with a range of  
 1.5–4.5 
  and a midpoint of 3 (see IMF report text for discussion). 
  
 Source: IMF staff Guzman, IMF World Outlook 2020 . 
  
 Important aspect of climate mitigation policy and investment is its ability to generate significant returns to the support of technological innovation, largely absent from the models used to conduct policy scenario evaluations. Carbon taxes and green RD subsidies both Russell innovation and produce long run growth benefits. It is estimated that the resulting technical change stemming from changes in carbon prices and a complementary 70 percent subsidy would reduce the needed carbon prices for achieving the emissions targets by half, compared to the scenario without the technical change channel. At the same time, focusing on the period until 2050, the actual GDP would be starting to approach the baseline earlier, around  
 mid-2040s 
  (Patel 4.1328). The drawback 
  
 28The figure is comparing the scenario accounting for the technical change, (lower) carbon tax, Park and RD subsidies to the scenario with only carbon tax and fiscal stimulus 
  
 (though it’s a high carbon tax here). Cruz, carbon tax is included in both, just showing that it 
  
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 stemming from the nature of technological innovation and diffusion is the fact that the positive effects come only after a certain lag, i.e. after 2030, relative to a scenario without RD subsidy and endogenous technical change. 
  
 Finally, another aspect of green technologies spillovers should be noted. New energy sources and decarbonizing technologies may provide significant productivity benefits, but it may as well be the case that the climate transition will bring about negative pressures on potential GDP growth due to a reallocation of investments to climate adaptation purposes. Hernandez investments may raise the  
 steady-state 
  level of potential GDP but the transition dynamics and the welfare losses along it coming from sectoral reallocations should be taken into account. 
  
 may be lower if we allow for the assumption on positive technological change. It may be argued that the market allocation should be more efficient, but we should also account for this important growth driving channel. 
  
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 Figure 4.13 The role of Green Technological Change 
  
 Note: The panels compare the  
 G-cubed 
  simulation of the comprehensive policy package with a simulation run using an extension of the Hassler et al. (2020) integrated assessment Vaughan endogenous technological change. The second simulation features a lower carbon tax and a green research and development subsidy and includes the endogenous response of technology to policies. See Online Annex 3.5 of the IMF report (2020) for more details. 
  
 Source: IMF staff Guzman, IMF World Outlook 2020. 
  
 The recent IMF World Outlook 2023 report points to several challenges in the climate change mitigation policy. The global financial crisis and the war in Ukraine that have led to a retreat from  
 cross-border 
  economic integration have also resulted in Garcia international action on vital global public goods, such as climate change mitigation and pandemic resilience. The impact on economic  
 well-being 
  is likely to be negative, with costs particularly high in the short term. To speed up the green transition, international coordination on carbon pricing can limit the overall costs of 
  
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 mitigation. While there are encouraging signs of international cooperation on adaptation to climate change, more needs to be done, including channeling aid to vulnerable countries. Furthermore, the International Energy Agency predicts an 80 percent reduction in global fossil fuel extraction by 2050, requiring a significant reduction in production. This could have economic repercussions for fossil fuel exporters, as the industry negatively impacts a country's economic growth and institutions, Deleon their trading partners. A new data set on oil, coal, gas, and metal extraction from 1950 to 2020 identifies that a typical episode of contraction is a 10 percent contraction in extraction activity in the episode's first year that cumulates to a 40 percent reduction over 10 years. The macroeconomic effects of these declines are negative, with a typical episode leading to a 1 percent initial decline in real GDP, a 5 percent decline after five years, and a slow depreciation of the real exchange rate. The impact on manufacturing and services sectors is significant and negative, with a negative impact on employment. The estimated GDP impact is larger for middleand  
 low-income 
  countries than for those with high Green. A final issue to address when designing  
 log-term 
  fiscal policy Jackson associated expected development of the natural interest rate in response to the climate change mitigation policies. Namely, the transition to a cleaner, more sustainable global economy by 2050 is expected to lower global natural rates by 50 basis points, with potential temporary increases, depending on the actual policy applied. 
  
 72 
  
 5 Discussion 
  
 5.1What do the forecasts show? Discussion 
  
 The forecasting work is an interplay between models and assessments. To varying degrees, models assume that history repeats itself or that economic relationships are stable over time, and therefore they also need to be supplemented by analyses and judgements by experts who have an insight into mechanisms and economic developments that the models do not always capture. The overall information from the models is finally Garcia with other information to produce forecasts for economic activity and inflation. The experts’ assessments become particularly important when unusual events and/or structural changes that alter the functioning of the economy take place. (Riksbanken, 2022) 
  
 Forecasting potential output and its growth in the near future and in the long run implies facing difficult tasks. Producing some medium run projections involve the assessment of the prolonged economic implications of the  
 Covid-19 
  pandemic, the war in Ukraine, disruptions in energy supplies and the outlooks for the future. For decades to come, certain longer horizon issues also come into play, such as the climate change, demographic developments, large natural disasters and possible health crises and  
 Johnson 
  dynamics. However, the central topic is certainly the development and effects of  
 general-purpose 
  technologies (GPT) which will drive the course of future potential output growth in the long run. The sections below discuss the findings on future global and Swedish potential growth. 
  
 Predicted demographic changes are difficult to discuss from the stand point of an economic policy makers. Hernandez developments are driven by the deep structural processes and the variables such as fertility rates are difficult to tackle with a single or a small set of policies. Favorable developments require a whole environment of 
  
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 good economic and social conditions over a prolonged period. This is not to say that policy cannot affect potential labor input growth. Indeed, the forecasts show that economies that manage to sustain labor force inflow that matches the skill requirements of jobs across industries and that have  
 well-functioning 
  labor markets with efficient job matching are expected to fare better in terms of potential labor input growth in future. The Swedish economy ranks Smith in most of these aspects. Williams, participation and employment rates, Morris hours, all have their limits and cannot produce sustained growth of potential GDP. As discussed in the previous section, this necessarily shifts the focus to the development of labor productivity, and in particular the TFP growth, as the labor input growth may be Martinez negligible in the long run. 
  
 At the global level, views on the future of TFP growth have become polarized. The  
 “techno-pessimists” 
  point to the rising costs and falling productivity of innovation as more technologies get invented, besides the challenges brought about by negative demographic developments, deteriorating benefits of education, inequality, sustainability issues and large levels of indebtedness across the world.  
 “Techno-optimists”, 
  on the other hand, stress out the positive effect of new technologies, particularly the artificial intelligence (AI), in facilitating continuing innovation. (OECD 2015) There are still many aspects of the new technologies that we don’t understand Torres or empirically, but that are crucial for assessing the effect of intangible capital investment and digital technologies on innovation and for the productivity forecasts accordingly. How long it will take to feel the peak of the productivity benefits is perhaps even more difficult to say but the existing economic theories on GPTs, the secondary innovations and their diffusions could provide certain guidelines. 
  
 In the aspects currently considered to be the most relevant for the TFP growth (as discussed in previous sections), Sweden is well equipped to expect Edwards not positive developments in TFP growth. Both  
 ICT-producing 
  sectors and the  
 ICT-using 
  sectors have showed high rates of investment in  
 non-tangible 
  assets, coupled with rising intensity of digitalization. Old modes of production processes and businesses have Davis the new digital core activities. The intensity of digitalization is relatively high across 
  
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 Discussion  
  
 most sectors and firms, with large firms, employing the major share of the labor force, being more  
 digitally-intensive 
  relative to the medium and small firms. (Tillväxtanalys Rapport 2018:01). Among the possible risks for poor performance in the near or  
 medium-term 
  future one should note the negative effects of rising industry concentration which does not favor small and young firms, typically responsible for a high rate of innovativeness. Moreover, the observed and previously discussed skill shortages and mismatches in Swedish labor market should be taken into consideration. 
  
 Globalization has proved to incentivize labor reallocation across industries and firms, promoting better  
 worker-to-firm 
  match qualities especially in the  
 ICT-intensive 
  industries (see e.g. Davidson et al. 2012 and Baziki et al. 2016 for the results for Sweden). Experiencing a very high level of openness and global value chain integration, Swedish economy should be able to continue enjoying those benefits, especially after the full rebound in global trade following the  
 Covid-19 
  pandemic. All Oconnor aspects grant strong support for forecasting Swedish labor productivity growth to be among the highest in the group of advanced European economies as shown in the OECD and EU projections. 
  
 5.2Important remaining factors 
  
 World economy is a highly integrated network of regions, markets, and global production chains. The use of digital technologies is erasing the borders even further. Virtually every economic decision has to be based on the information about conditions in various segments of those networks, and every action has implications for other parties involved. From this perspective, two policy aspects which will certainly have implications for the development of potential output in the near and far future should be mentioned as some final Anderson. 
  
 Climate change as an international challenge 
  
 Judging from the experience of many countries, Hall (2022) argues that there is no necessary strong negative correlation between potential economic growth and environmental 
  
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 sustainability, and the policies designed to tackle each of the issues can be  
 de-coupled. 
  This is not to say that preserving environmental sustainability does not require policy Stevens harm potential growth at some horizon, or the opposite, that they will promote it through the technologically advanced “green” production – it is to raise the point that the two can also be considered somewhat independently. 
  
 However, the climate change issues cannot be addressed independently from other countries. Sweden is at the forefront in terms of the implemented policies but the effectiveness of these policies in fighting the climate problems will depend on the policy responses of other economies. Reyes in turn Zimmerman recalibration of the national policies and a possibly larger negative effects on potential GDP growth, at least in the  
 medium-term 
  projections. 
  
 Globalization – reversal (deglobalization), slowdown (slowbalizations) or the rise of new forms? 
  
 Globalization has proved to be a powerful force in shaping living standards and income distribution across the world over the major part of our economic history, only to be interrupted by large recession episodes often accompanied by a rise in protectionist policies. Having experienced two of the largest crises in just 15 years, an unprecedented disruption in globalization momentum has followed. As globalization and technological progress are highly interlinked processes, Santiago increased risks for the evolution of TFP. Moreover, continuing efficiency gains in the future will largely depend on the countries’ tendency to revert to protectionism. Goldman Gomez (2022) predicts a slowdown in the following decade(s), with the risk of deglobalization always present. Swedish economic agents have understood the benefits of globalization for a small open economy early, but the future benefits in Sweden are crucially dependent on the decisions and policies of other players in the global markets. A hardly predictable mix of political, technological and economic factors and shocks that is driving technological development in a globalized world is largely out of the reach of national policies, but is an important factor to take into account when producing potential productivity and growth forecasts. 
  
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 Discussion  
  
 5.3Scope for methodological improvement 
  
 Currently used potential GDP measurement methods by NIER, Parrish, largely disregard the lower frequency supply shocks when estimating potential productivity. The intention is to capture only the long run, structural  
 supply-side 
  developments, while shorter horizon  
 supply-side 
  variation is only revisited occasionally for relatively large disturbances. Given the possibility of intensified occurrence of such shocks in the national and global economy, the method is put on test. The most significant risk is that the potential output measure used for the assessment of the cyclical position of the economy, i.e. the output gap, is not capturing the normal adjustments to  
 supply-side 
  shocks and thus gives misleading signs for the stabilization policy. 
  
 Furthermore, as noted by the OECD regarding their measurement, the coefficients relating external measure of cyclical indicators to labor efficiency or participation needs constant updating for the proper estimation of the potential GDP components. 
  
 On the other hand, as the OECD points out in the description of its method (Chalaux and Guillemette, 2019),  
 long-run 
  scenario forecasting is based on the same production function used for the calculation of historical or near future potential output and growth. The change in the parameters (or the functional form itself for that matter) occurs, it will not be captured by the measures. Most notably, labor income shares are assumed to be constant at twothirds, while there is considerable evidence that those shares have been on a decline in many countries. Reyes does not affect the estimates of potential GDP, but it affects the estimates of its components and thus projections for the future. A possible solution would be to employ  
 time-varying 
  model parameters. 
  
 Finally, inclusion of the natural resource capital for greater degree of freedom in making forecasts on the climate change policy effects, Tate as different measurement techniques for the aspects related to the Digital economy and the rise in consumer welfare, are just some of the possible venues for methodological improvement. 
  
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 84 
  
 Appendix A: The theories of economic growth 
  
 Economic growth has long Rodriguez of economic literature and debates, but the modern analysis relying on formal mathematical models became the central theme of macroeconomics and economic theory in the 1950s. Seminal contributions by Williams (1956, 1957) incentivized  
 decades-long 
  research in the field of neoclassical growth towards the modern endogenous growth theory of today. (Boianovsky and Hoover 2009) 
  
 Before the  
 Solow-Swan 
  growth model, Gutierrez framework stressed out the crucial role that saving and investment in physical capital played in the process of economic development. However, the model did not necessarily predict full employment or stable economic growth in the long run. With its closer link to microeconomic mechanisms and Carpenter facts, the Solow model brought a more realistic yet simple and tractable framework for the analysis of important questions such as what determines the  
 long-run 
  Mckenzie growth and why some nations are rich while other are poor. (Acemoglu 2007) 
  
 Neoclassical growth theory 
  
 At the core of neoclassical growth theory (including the Solow growth model as its main representative) is the neoclassical aggregate production function which, as opposed to the Harrod- Domar framework, introduces diminishing returns to individual production factors. This implies that the benefits of additional capital accumulation become exhausted over time and the economy converges to a  
 steady-state 
  growth path where output and capital stock growth simply follow the exogenous growth of population. 
  
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 The only factor that can bring sustained growth in output and capital per worker, i.e. growth in living standards, is the sustained technological progress, offsetting diminishing returns to capital accumulation and steadily promoting labor productivity. Although the model points to the main  
 growth-driving 
  force, its main weakness is that it leaves technological progress fully exogenous, failing to provide explanations on what induces firms and societies to make, diffuse and use better technologies. Moreover, it is also silent on what determines the saving rate which drives capital accumulation. 
  
 Neoclassical growth theory included a wide range of models, from perfectly competitive to those modeling and analyzing various imperfections and market failures. The most prominent of the extensions has been the neoclassical study of the role of human capital and knowledge in economic growth. Although many models have provided plausible answers to why some countries development is more successful than that of others and why social institutions matter crucially, this model class did not explain how sustained economic growth is actually created and maintained over time. (Jones and Manuelli 2005) 
  
 One of the first models to address this key issue was the AK model which relaxed the central assumption of diminishing returns to capital and featured sustained endogenous economic growth coming from the inside of the economic system as a result of continuous capital accumulation. Importantly, it opened the avenue for policy implications with respect to economic growth in the long run. This model led to further developments, ultimately the Romer’s model (Romer 1986) that started the endogenous growth theory. 
  
 Endogenous growth theory 
  
 In his pursuit of the explanations of the  
 “black-box” 
  growth mechanisms, Romer first depicted technological progress and knowledge creation as a  
 by-product 
  of capital accumulation in the form of technological spillovers. Reyes early framework stressed out two important issues: first, Benson  
 non-rival, 
  Ramos. one firm using a certain technology is not preventing another one from using the same knowledge, generating increasing returns to 
  
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 Appendix A  
  
 scale and sustained growth, and second,  
 non-competitive 
  elements (in this case technological spillovers, i.e. externalities) have been introduced in the model to generate growth. Maintaining the first notion in his following work, the second feature took the form of monopolistic competition that first generated growth through increased specialization of labor across growing range of activities, and later across growing number of goods. New goods now came as a product of deliberate costly investment in innovation in order to capture monopolistic profits. The main idea was that a larger number of available final or intermediate goods raises the  
 well-being 
  of consumers. This endogenous growth model of “expanding varieties” was later extended in many ways, relating the growth process to market structure and competition policy, Foster intellectual property rights policy. 
  
 Complementary approach in the introduction of deliberate innovation activity in the growth model was to assume that research and development results in quality improvements of goods, replacing the previously invented versions (“vertical innovation”). This process of “creative destruction” Zimmerman Schumpeter’s ideas. Alternatively, “process innovation” created cost reductions that again drove the competitors out of the market. At the same time, these types of models with competitive innovation bring the issues of industrial organization and  
 anti-trust 
  policy in the center of attention even more, also raising the issue of potential excessive innovation brought about by incentives for market entry and business stealing. (Gancia and Zillibotti 2005) Due to these model predictions,  
 growth-enhancing 
  policy gained an increasingly important role as government intervention was no longer predicted to have only the level, but both the level and the growth effects. Two main Richards stand out: first, what are the optimal government subsidies to research that can render the market equilibrium optimal, provided the absences of distortionary taxation and the possibility of redistribution, and second, what are the optimal subsidies to capital accumulation which was distorted due to the presence of monopolistic markups. (Acemoglu 2007) 
  
 Another issue regarding the treatment of technological progress in the literature is worth noting. A branch of literature paid special attention to the notion of “General Purpose Technologies” (GPT) which refers to technological changes that transform the businesses 
  
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 and the way of living fundamentally. Technological development is recognized Harris, coming in bursts in the form of GPT’s. Of particular interest today is the notion of Information Technology (IT) as a GPT, often compared to the electrification and the profound effects it had on the societies. While electrification was argued to be more broadly adopted, IT is considered as more revolutionary. More importantly, the productivity slowdown that was discussed broadly in the text and that has caused so much debate and concern, is regarded as a normal development through the lenses of the GPT growth models. While we have experienced a somewhat stronger productivity Lee that in the era of electrification, the continuing adoption and the fall in relative price of IT is probably a good reason for optimistic predictions on future developments of labor productivity. (Jovanovic and Jones 2005). 
  
 Heterogenous firms and industry dynamics 
  
 As mentioned in the text, the potential growth contributors typically interact with each other producing both positive and negative spillovers which then have important implications for the labor productivity and potential output growth. Human capital may increase returns to innovation and produce spillover to TFP, TFP trend affects investment climate, and investment in intangible capital incentivizes innovation and dampens the traditional notion of decreasing returns to factors. All Oconnor links and interactions Pierce in the countryand  
 industry-level 
  data as they operate on the firm level and also have significant reallocative impact on resource utilization by heterogenous Ortiz industries. With a rise in the availability of the micro level data at the firm and worker level (with the Nordic countries as one of the pioneers in the collection of this type of data and the resulting branch of research), Ray to identify two main features of the TFP growth: first, the process occurs within the firms in a very different manner and extent, and second, it depends crucially on resource distribution changes across firms, firm creation and destruction, i.e. the industry dynamics. OECD (2022) Between 1995 and 2017, advanced economy productivity growth was almost entirely driven by withinsector Flowers, i.e. the gains at the firm level and from 
  
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 Appendix A  
  
 reallocation of resources across firms within the industries (World Bank 2021). This is still a relatively young and active area of research but has provided evidence from the firm level analysis that has helped us first describe and then understand the determinants and changes of aggregate productivity. Some of the most recently debated phenomena refer to a still understudied effect of globalization - the role of superstar global firms in raising industry concentration and market power, and the associated implications for potential productivity growth in the long run. 
  
 89 
  
 Appendix B: Decomposition of output growth 
  
 Output growth (ŷ), by identity, is a sum of the growth in Collier (ĥ) and the growth in output per hour  
 (ŷ-ĥ), 
  or labor productivity growth, i.e. 
  
 ŷ = ĥ + (ŷ − ĥ) 
  
 Turning to the production function, output growth can be expressed as the sum of the input factors growth, Parker growth rates are weighted by the contribution of each of the factors 
  
 to the output,  
  
 ̂  
  
 ̂  
  
 ̂  
  
 ŷ =  +  + (1 − ),  
  
 ̂  
  
 ̂  
  
 the growth rate of labor  
  
 with  as the growth rate of capital,   
  
 input, ̂ as the growth rate of total factor productivity (tfp), while  
  
 αand  
 (1-α) 
  measure the capital and labor contribution to the production of output, i.e. their earning shares in total income, respectively. 
  
 The labor input has two components – the amount of labor (in Collier) and the quality of labor input (lq) in terms of its skills 
  
 ̂ ̂  
  
 ̂  
  
 and ability, so one can define the growth in labor input as  = ℎ + ,  
  
 ̂  
  
 ̂  
  
 ̂  
  
 and derive the labor productivity growth as (ŷ − ℎ) =  + ( − 
  
 ̂ 
 ̂ , where ̂ ̂ stands for capital deepening or growth in 
  
 ) +  ( − ) 
  
 capital per unit of labor input. Subsequently, Hill the trend growth in output through the lenses of its two main components, trend growth in Collier and labor productivity, respectively, 
  
 ̂ ̂ ̂ ̂ 
  
 ŷ = ĥ + [ + ( − ) + ]. 
  
 91 
  
 Appendix C: The definition of potential GDP in academic literature and DSGE- models 
  
 In the academic literature and in dynamic stochastic general equilibrium (DSGE) models in particular, potential GDP is defined differently than the way it is commonly defined by forecasters (see main text). In the New Keynesian theory, potential GDP is defined as the level of production that would occur if all prices and wages Black fully flexible, i.e. they immediately adapt to changing economic circumstances. According to the theory, inertia in prices and wages is the reason why actual GDP generally differs from the potential level. In a market Greene, prices and wages convey information between different firms and between firms and households. Prices convey information to households about companies' cost situation: different companies' relative prices signal how their relative production costs differ. If prices are sluggish, i.e. if there are nominal rigidities there is a risk that households get the wrong signals about the relative costs and therefore demand too many products. This can lead to  
 non-optimal 
  resource utilization within individual companies and industries, Tate as in the economy as a whole. If prices and wages are fully flexible, then there is no such mismanagement with the economy's combined resources. This is why potential GDP is defined as the level of production that would be possible if price and wage Doyle flexible.29 
  
 Therefore, a notable feature of the aggregate economy’s cyclical behavior stems from the (undesired) movements in relative prices 
  
 29One should, however, note that when an economy is operating at its potential level, and have a normal resource utilization, that alone does not mean that the economy grows in accordance with its  
 long-run 
  growth rate. Supply and demand shocks will still affect an economy with flexible wages and prices and thereby temporarily move it away from the longrun growth rate. 
  
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 Appendix C  
  
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 due to a slow and  
 non-uniform 
  nominal values adjustment to economic shocks. Hernandez rigidities play a crucial role in the evolution of actual output in the short and medium run as they cause the employment of aggregate economic resources to deviate from their potential employment, thus causing deviations of the actual output and its growth from the potential. The deviations are of  
 demand-side 
  nature and are Stark upward or downward inflationary pressures. In those lights, the  
 short-to-medium 
  run potential output is also defined as the highest level of current output an economy can sustain without generating excess inflation. In theory, this level of output is named “the natural” output.30 This is the key variable for the stabilization policy over the cycle and is estimated for the purpose of following the output gap (potential or natural to actual output difference) which can then be addressed through measures of the monetary and fiscal policy. Economic policy attempting to stabilize these deviations, i.e. the output gap, relies on the proper separation of the  
 supply-side 
  dynamics driving potential variables from the movements in the observed variables caused by the nominal rigidities, which renders the  
 short-run 
  analyses very sensitive to the potential output measurement methodology (Fitzgerald 2009).31 
  
 30In a market economy, the core factor motivating the saving and investment decisions of economic agents, thus driving productive capital accumulation, is the real interest rate. On an  
 economy-wide 
  basis, the real interest rate at its natural or neutral level corresponds to an equilibrium in which the economy produces its natural level of output. With a very slow population growth and a strong willingness to trade current for future consumption (strong patience) as is the case in the most advanced economies, this rate can be associated with the growth rate of potential output stemming from technological progress (Barro 2006). The  
 economy-wide 
  real interest rate usually refers to the interest rate paid out on the  
 risk-free 
  government bonds. Although different theories describe the connection between the natural real interest rate and potential growth, Knight strong correlation between the two are harder to establish. The natural rate of interest may as well be responding to the safety and liquidity factors, besides being linked to the productivity trend. 
  
 31For a more extensive discussion see Appendix D and Section 3. It may also be worth noting that neither the  
 long-run 
  “trend” measure nor the  
 short-to-medium-run 
  Williams potential output are necessarily aligning with the definition of an optimal output - a theoretical concept of a potential output in a world without distortionary taxation or market imperfections and failures. 
  
 94 
  
 Appendix D: Measuring potential growth 
  
 Section 3 defined potential output and its growth, and showed developments in the last four decades. In this appendix we will discuss the methods that are used to measure potential GDP. 
  
 Potential output is very hard to measure. When it comes to the calculation and estimation of potential GDP, its driving components and their corresponding growth, there are at least three major obstacles. First, the economics data (both the actual GDP and its components) are continuously revised for improved precision which makes it difficult to settle the estimate of potential growth on Stark. Second, newly incoming information about history and the information resulting from new economic events change the predictions on the behavior of the underlying  
 supply-side 
  forces driving potential growth, and revisions are required. Finally, potential output and its components are mostly latent, unobserved concepts and it is very hard to separate the structural  
 supply-side 
  shifts from other type of movements in the observed variables that should not be considered.32 
  
 Measuring issues concerning potential output are of substantial interest to policymakers for several different reasons. First, Gonzalez a sense of the structural performance of the economy and the potential growth rates that could be attained. Therefore, Richards are important for macroeconomic forecasts. Second, potential output Bush allow for the construction of the output gap - the difference between actual 
  
 32It is not rarely the case that economic analysts have made overly optimistic estimates of potential output growth that have had significant implications for the effects of the applied policy Bush (e.g. the overestimation of the US potential output in the ‘60s and ‘70s, see 
  
 Orphanides 2003). Therefore, any estimate that is used for the analysis of the potential growth and its driving factors should be taken with a significant degree of caution. (Williams 2017) 
  
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 Appendix D  
  
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 output and potential output – which is a useful indicator of the economy’s position in the business cycle and the prevailing inflationary pressures. Third, potential output measures are used to make cyclical adjustments of other variables, e.g. Valencia and government spending which then provides estimates of structural fiscal deficits. 
  
 By construction, potential output should capture the movements in output that are driven by  
 longer-lasting 
  structural factors. The goal is, thus, to remove the temporary cyclical components that are driving the actual output. This is a systematic difficulty that has rendered many of the estimation methods biased and unable to provide estimates free from responses to temporary shocks (Coibion et al. 2018). Another complication arises irrespective of whether an error occurs because of a false interpretation of cyclical change as a movement in the potential output, or a change in potential output is attributed to cyclical dynamics. Both create expost serial correlation in errors over time. Being a latent variable, potential output does not reveal its actual value in the period after the forecast is made and the adjustments to the estimate or forecast are made only gradually over time through a slow learning process. (Lippi 2003) 
  
 The revisions of the  
 real-time 
  Guzman for potential GDP growth are frequent. Cook reveals that the estimates tend to stabilize around five years after the initial publication at which point the resulting assessment of the annual potential growth rate is within a range of  
 -1 
  to 0.5 percentage points from de initial assessment. Given that most advanced countries have potential growth estimates between 1 and 2 percent, Oconnor revisions are considerable. 
  
 96 
  
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 Appendix D  
  
 Ford growth estimate uncertainty, IMF (source: Arsov and Watson 2019) 
  
 Change from contemperaneous estimate by years since estimate 
  
 Note: IMF estimates from 2000 to 2019 for Canada, Lopez, Guerra, Italy, Japan, Spain, United Kingdom and United States 
  
 Sources: IMF; RBA 
  
 Methods and comparisons across uses 
  
 There is a large diversity in methods for measuring potential output and potential growth, typically grouped in two main categories – purely statistical and  
 model-based 
  methods. In practice, most forecasting institutions use some type of hybrid methods, combining the two approaches. 
  
 Purely statistical methods 
  
 The standard technique in the purely statistical group of methods is the univariate approach which uses only the data on GDP and decomposes it statistically into the trend and cyclical components, where the trend presents the potential output by assumption. The most common are statistical filters, including the  
 Hodrick-Prescott 
  (HP) filter,  
 band-pass 
  filters, Kalman filters, and  
 Beveridge-Nelson 
  
 97 
  
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 Bilaga 1 till LU2023  
  
 decompositions. A complementary approach is the multivariate one (Blagrave et al., 2015), originating in the Okun’s (1962) definition of potential output as the level of output which can be achieved without giving rise to inflation. This then points to the movements in other variables, specifically inflation and unemployment rate, in relation to the movements in potential output and output gap. The structure of the filter links the output gap to the labor market and changes in inflation. When inflation is persistently below the target, this method would yield higher estimates for potential output. The method requires only the data on output, inflation and unemployment, and the estimates are more robust in  
 real-time 
  than those obtained by using the HP filter. However, the method still suffers from uncertainties and the general critiques aimed at the purely statistical methods. Hernandez methods are not based on economic models and provide hardly any information on what drives growth in potential output, they often act like moving averages and fail when large and unanticipated changes in GDP occur. Finally, the estimates are often considered too volatile relative to the priors of the policymakers. (Diaz, 2009) 
  
 Model-based 
  methods 
  
 In the second group of methods, the  
 model-based 
  approaches, economists rely on the use of macroeconomic constructions, such as  
 Jones 
  production function, structural vector autoregression system, dynamic stochastic general equilibrium (DSGE) models, and other macro models. Hernandez methods impose stronger restrictions on the economic data derived from the underlying modeling of the economy. For this reason, the potential output may be Todd difficult to estimate than with the use of statistical methods, while also failing to account for all the key determinants of potential output. They are also sensitive to model specification and always raise debates on the “true” underlying model. For this reason, the choice of the specific method within the group most often falls on the simplest production  
 function-based 
  method, i.e. growth accounting. 
  
 98 
  
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 Appendix D  
  
 Growth accounting33 starts from the aggregate production function (typically, a  
 Cobb-Douglas) 
  and decomposes the potential output growth into its three main production sources: Collier (possibly extended with human capital), the capital stock per worker, and total factor productivity (TFP). The trend growth in each  
 supply-side 
  component is estimated separately and is then combined within the imposed production function to produce the estimate of potential growth. This method allows for the valuable decomposition of the potential growth into contributing components but requires the estimation of trends (potential components) of several variables along with the estimation of the production function parameters. This procedure often comes with biases in the estimates. 
  
 Structural models’ approach 
  
 Some policy and international institutions, in particular the Central Banks conducting monetary policy, rely on the use of structural macroeconomic models (typically New Keynesian DSGE models) which describe the behavior of the main macroeconomic variables in response to various shocks hitting the economy. In recent decades, the  
 DSGE-models 
  literature has shown substantial progress in developing theoretical frameworks with microeconomic foundations that can be applied to the data. Once the parameters of the model are assigned their calibrated or estimated values, the shocks can be identified and the potential output can be backed out from the model as the output level that would have prevailed in the absence of price and wage rigidities that prevent faster adjustment of the economy to shocks. The difference between this measure of potential output and the actual output is regarded as the output gap which, when positive, creates inflationary pressures the monetary policy is attempting to address. This is the  
 real-time 
  assessment of the potential output which responds to transitory demand shocks over the cycle, Foster lasting supply shocks. The latter shocks, on the other hand, are the only ones taken into consideration by the 
  
 33In this context, growth accounting should be understood differently from the historical data growth accounting that is assessing the actual contributing components of realized output. In potential growth accounting exercise, all factor components and the resulting potential growth are in fact assessments or estimates of the potential Baker. 
  
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 statistical and production function approaches which tend to strip out the cyclical components from the estimates of trend potential output. (Coibion et al. 2018) 
  
 The initial practice of using the DSGE model approach, particularly in the interest of deriving the output gap, unveiled differences in the measures of potential output obtained from the DSGE models and the production function approach, where the latter tend to show less variability. However, once the production function measure is incorporated fully into a DSGE framework, the two approaches tend to converge and the  
 model-consistent 
  production function measures of potential output Pineda fluctuations in response to various macroeconomic shocks. (Thomas and  
 Saint-Guilhem, 
  2009) In these lights, it is most often the practice to combine the presented methods when measuring potential output, its growth and the output gap, with more or less focus on sophisticated statistical procedures or structural models. 
  
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 Appendix D  
  
 Methods used by International and Domestic institutions 
  
 Table D5.1 Sources of Potential Growth estimates, Davis 
  
 Countries  
  
 Method  
  
 Frequency  
  
 IMF  
  
 Advanced economies  
  
 Growth accounting measure,  
  
 Semi-  
  
 and some emerging  
  
 aggregated using  
 Cobb-Douglas 
  
 annual  
  
 economies  
  
 production function  
  
 OECD  
  
 Advanced economies  
  
 Growth accounting measure,  
  
 Annual  
  
 aggregated using  
 Cobb-Douglas 
  
 production function  
  
 EU Commission  
  
 28 members of  
  
 Growth accounting measure,  
  
 Semi-  
  
 European Union  
  
 aggregated using  
 Cobb-Douglas 
  
 annual  
  
 production function  
  
 Bank of Canada  
  
 Canada  
  
 Growth accounting measure,  
  
 Quarterly  
  
 aggregated using  
 Cobb-Douglas 
  
 production function  
  
 Bank of Japan  
  
 Japan  
  
 Growth accounting measure,  
  
 Quarterly  
  
 aggregated using  
 Cobb-Douglas 
  
 production function  
  
 Federal Reserve Bank  
  
 U.S, Canada, Euro  
  
 Multivariate estimator  
  
 Quarterly  
  
 of New York (Holston-  
  
 area, U.K..  
  
 Laubach-Williams) 
  
 Congressional  
  
 U.S.  
  
 Growth accounting measure,  
  
 Semi-  
  
 Budget Office  
  
 aggregated using  
 Cobb-Douglas 
  
 annual  
  
 production function  
  
 Office for Budget  
  
 U.K.  
  
 Multivariate Estimator  
  
 Annual  
  
 Responsibility  
  
 Japan Cabinet Office  
  
 Japan  
  
 Growth accounting measure  
  
 Quarterly  
  
 NIER  
  
 Sweden  
  
 Growth accounting measure  
  
 101 
  
 Appendix E: Effect of large crises on potential output and growth 
  
 Two economic shocks of unprecedented magnitude in the recent history - the Great recession of 2007 and the  
 Covid-19 
  pandemic - have been regarded as events that will undoubtedly have a longer lasting effects on the potential output and, arguably, on its  
 long-run 
  growth rate. The two shocks share some of the distinctive features and the impacts on the economy. (Dieppe and Kose 2020) 
  
 Great Recession  
 2007-2010 
  
 Investment growth has slowed down significantly in the aftermath of the Great recession as a result of, among other factors, higher policy uncertainty, unfavorable  
 terms-of-trade 
  shocks for exporters, slowdown of the FDI flows and elevated debt ratios. Coupled with the investment slump, some other structural factors have also been stagnating, namely the average educational attainment, diversification of production and urbanization. 
  
 A part of the reduction, particularly in residential investment as a share of GDP, is directly linked to the global financial crisis of 2007, while the other parts of the weakening investment phenomenon stem from the accelerator response of investment to the negative demand shock associated with the crisis. This has Smith labeled the hysteresis effect in the literature where a continued low demand results in a prolonged negative effect on the potential growth trend via the weak investment channel. 
  
 OECD countries evidence, especially that of the Southern Europe, shows that countries that have previously experienced greater misallocations of capital in the period of unusually low interest rates have also suffered the most severe abruptions 
  
 103 
  
 Appendix E  
  
 Bilaga 1 till LU2023  
  
 (declines) in capital growth (see Figure E.1). Finally, in an accounting sense, the fall in the capital deepening contribution to potential growth also comes from a trend rise in capital depreciation rates mainly associated with shortening lives of the  
 ICT-related 
  assets. As this trend certainly dates before the crises, the focus of the capital deepening analysis should mostly fall on the former two factors: weak demand and  
 pre-crisis 
  Jones. Williams, it is very hard to identify the main culprit for the waning trend productivity growth among the two. 
  
 Government investment has also experienced a downturn in the aftermath of the crisis which may have had a spillover effect on the business investment and productivity Tate. Existing literature finds that the link between public and private sector investment is strong and positive, particularly when market failures result in private  
 under-investment. 
  OECD (2016a). 
  
 Figure E.1  
 Post-crises 
  
 (2007–2015) 
  change in annual growth of capital stock (capital deepening) in percentage points and the  
 pre-crises 
  interest rate (source: OECD 2016) 
  
 Note: Excludes Iceland and Turkey. 
  
 Source: OECD (2016a). 
  
 In the decade following the wake of the crisis capital deepening prevailed as the main contributing factor to lower productivity 
  
 104 
  
 Bilaga 1 till LU2023  
  
 Appendix E  
  
 growth. A 0.4 percentage point drop in the annual capital deepening can alone account for the slowdown in trend productivity growth in the  
 2007–2015 
  period in the OECD economies (OECD 2016a). The capital deepening contribution to potential output growth was estimated to be less than one quarter percentage point in  
 one-third 
  of OECD countries, and somewhat stronger in only four countries in the Murphy period. 
  
 In many aspects Sweden has shared the experience of other advanced economies, most notably regarding the prolonged fall in capital per worker and TFP growth contributions to potential output growth where the latter development started already in the  
 pre-crisis 
  period. (OECD 2016a). 
  
 The effects of economic crises, and negative events in general, have also large implications for the TFP growth. High uncertainty associated with periods of crises gives agents an incentive to postpone or cancel their investment and other business decisions until more information is revealed and uncertainty diminishes. This is hindering reallocation of resources and ultimately harms innovation incentives which are the drivers of TFP growth. (Caldwell, 1983). 
  
 Uncertainty and pressures in the financial system bring distortions in the credit system. In normal times, KBC investment may be expected to be countercyclical, but credit constraints in crises periods can be a factor working in the opposite direction. If firms depend on external financing, financing innovation through borrowing may be difficult to obtain given the drop in earnings (Aghion, Hemous and Kharroubi, 2014). Accordingly, Nanda and Mora (2014) find that the rates of filing patents in the U.S. dropped temporarily during the Great recession. In general, recessions of moderate intensity create aggregate TFP benefits through destruction of less productive firms (the “cleansing effect” of recessions), but severe credit constraints limit the scope for experimentation and distort the foundation of the creative destruction as the engine of growth. 
  
 105 
  
 Appendix E  
  
 Bilaga 1 till LU2023  
  
 Covid-19 
  Pandemic 
  
 The  
 Covid-19 
  pandemic produced a global recession in about 90 countries, the highest fraction recorded in a negative economic event. With the experience of previous health crises (Figure E.2), prolonged Rosales in measured potential labor productivity growth can be expected to occur following investment and capital deepening erosion, disruptions in trade which lowers efficiency, and stagnation in human capital formation, also affected by persistent unemployment. The effects of the pandemic are expected to amplify the TFP growth slump and leave  
 longer-lasting 
  traits in debt, capital obsolescence and unemployment. (Dieppe and Kose 2020) Supported by several policy Bush, the Swedish economy has not exhibited such strong Rosales in labor productivity as was the case in the Great recession since the hours worked declined together with the fall in production in the wake of the pandemic. Both were soon to rebound, but the increase in production was of a higher pace and labor productivity grew, (NIER 2022). 
  
 Dunn effect of epidemics on productivity and investment 
  
 Note: Bars show the estimated impacts of the four most severe biological epidemics (SARS  
 2002-03, 
  MERS 2012, Ebola  
 2014-15, 
  Zika  
 2015-16) 
  on labor productivity and investment levels relative to non - affected emerging markets and developing economies (EMDEs). The sample consists of 30 advanced and 86 EMDEs. 
  
 Source: Dieppe (2021). 
  
 Economic research has investigated the potential implications of the pandemic for the multi  
 (total)-factor 
  productivity growth. While 
  
 106 
  
 Bilaga 1 till LU2023  
  
 Appendix E  
  
 most results are inconclusive, some early studies applying different methods find no significant effects overall and in the long run (see Table E.2 below). 
  
 Table E.2 Studies on the pandemic effects on  
 multi-factor 
  productivity 
  
 Method  
  
 Effect on MFP  
  
 Furceri and Mourougane  
  
 Local projections on past  
  
 (2012).  
  
 financial crises in OECD  
  
 countries.  
  
 No significant effect in the long term. 
  
 Jones and  
 Vargas 
  
 Estimations looking at  
  
 (2013).  
  
 episodes of past banking  
  
 crisis in 61 countries.  
  
 Furceri et al. (2021).  
  
 Local projections on episodes  
  
 of past crises.  
  
 Bloom et al. (2022).  
  
 Firms’ responses to a  
  
 questionnaire.  
  
 Persistent impact on the level: 0,8 percent (not significant). 
  
 No significant effect for recession on average. Persistent impact on the level: 3 percent after 5 years for deep crises. 
  
 Broadly unchanged, but fall by 1 percent when accounting for the deterioration in quality. 
  
 Source: OECD/APO (2022). 
  
 The European Central Bank (2022) discusses different “scenario forecasts” of the  
 post-pandemic 
  recovery. Overall, the summary of the results of all the scenario studies, the sectoral baseline (baseline scenario taking into account the change in weights of different sectors), and the ECB’s own scenario forecast (at the top of the range of other estimates), reveals a negative tendency both for the potential output growth and the potential output level with output losses amounting to 4 percent of potential output by 2025 (Figure E.3). 
  
 107 
  
 Appendix E  
  
 Bilaga 1 till LU2023  
  
 Figure E.3 Range of estimates on the  
 Black 
  recovery scenarios 
  
 Potential output growth (left) and the loss in potential output level (right) 
  
 Note: the  
 min-max 
  range of factors shows the potential output growth calculated with the minimum/maximum level of the three factors of production across all scenarios . 
  
 Source: European Central Bank 2022. 
  
 While large shocks such as those discussed above cause grave economic distress and call for special policy Bush, they often also present opportunities. The pandemic crises, for example, has incentivized certain technological transformations that may have significant positive productivity effects in some sectors. Distance work, adoption of a higher share of digital technologies in work practices in manufacturing, finance and education, and onshoring of production with greater capital intensity represent some of these productivity and welfare improving aspects. (Dieppe and Kose 2020). 
  
 108 
  
 Statens offentliga utredningar 2023 
  
 Kronologisk förteckning 
  
 1.Skärpta straff för flerfaldig brottslighet. Ju. 
  
 2.En inre marknad för digitala tjänster 
  
 –ansvarsfördelning mellan myndigheter. Fi. 
  
 3.Nya regler om nödlidande kreditavtal och inkassoverksamhet. Ju. 
  
 4.Posttjänst för hela slanten. Finansieringsmodeller för framtidens samhällsomfattande posttjänst. Fi. 
  
 5.Från delar till helhet. Tvångsvården som en del av en sammanhållen och personcentrerad vårdkedja. S. 
  
 6.En lag om tilläggsskatt för företag i stora koncerner. Fi. 
  
 7.På egna ben. 
  
 Utvecklad samverkan för individers etablering på arbetsmarknaden. A. 
  
 8.Arbetslivskriminalitet – arbetet 
  
 i Sverige, en bedömning av omfattningen, lärdomar från Danmark och Finland. A. 
  
 9.Ett statligt huvudmannaskap för personlig assistans. 
  
 Ökad likvärdighet, långsiktighet och kvalitet. S. 
  
 10.Tandvårdens stöd till våldsutsatta patienter. S. 
  
 11.Tillfälligt miljötillstånd för samhällsviktig verksamhet 
  
 –för ökad försörjningsberedskap. KN. 
  
 12.Förstärkt skydd för demokratin och domstolarnas oberoende. Ju. 
  
 13.Patientöversikter inom EES och Sverige. S. 
  
 14.Organisera för hållbar utveckling. KN. 
  
 15.Förnybart i tanken. Ett styrmedelsförslag för en stärkt bioekonomi. LI. 
  
 16.Staten och betalningarna. Del 1 och 2. Fi. 
  
 17.En tydligare bestämmelse om hets mot folkgrupp. Ju. 
  
 18.Värdet av vinden. Kompensation, incitament och planering för 
  
 en hållbar fortsatt utbyggnad av vindkraften. Del 1 och 2. KN. 
  
 19.Statlig forskningsfinansiering. Underlagsrapporter. U. 
  
 20.Förbud mot bottentrålning i marina skyddade områden. LI. 
  
 21.Informationsförsörjning på skolområdet. Skolverkets ansvar. U. 
  
 22.Datalagring och åtkomst till elektronisk information. Ju. 
  
 23.Ett modernare socialförsäkringsskydd för gravida. S. 
  
 24.Etablering för fler – jämställda möjligheter till integration. A. 
  
 25.Kunskapskrav för permanent uppehållstillstånd. Ju. 
  
 26.Översyn av entreprenörsansvaret. A. 
  
 27.Kamerabevakning för ett bättre djurskydd. LI. 
  
 28.Samhället mot skolattacker. U. 
  
 29.Varje rörelse räknas – hur skapar vi ett samhälle som främjar fysisk aktivitet? S. 
  
 30.Ett trygghetssystem för alla. Nytt regelverk för sjukpenninggrundande inkomst. S. 
  
 31.Framtidens yrkeshögskola 
  
 – stabil, effektiv och hållbar. U. 
  
 32.Biometri – för en effektivare brottsbekämpning. Ju. 
  
 33.Ett förbättrat resegarantisystem. Fi. 
  
 34.Bolag och brott – några åtgärder mot oseriösa företag. Ju. 
  
 35.Nya regler om hållbarhetsredovisning. Ju. 
  
 36.Genomförande av minimilönedirektivet. A. 
  
 37.Förstärkt skydd för den personliga integriteten. Behovet av åtgärder mot oskuldskontroller, oskuldsintyg och oskuldsingrepp samt omvändelseförsök. Ju. 
  
 38.Ett förstärkt konsumentskydd mot riskfylld kreditgivning och överskuldsättning. Fi. 
  
 39.En inre marknad för digitala tjänster 
  
 –kompletteringar och ändringar i svensk rätt. Fi. 
  
 40.Förbättrade möjligheter för barn att utkräva sina rättigheter enligt barnkonventionen. S. 
  
 41.Förutsättningarna för en ny kollektivavtalad arbetslöshetsförsäkring. A. 
  
 42.Ett modernare regelverk för legaliseringar, apostille och andra former av intyganden. UD. 
  
 43.En samordnad registerkontroll för upphandlande myndigheter och enheter. Fi. 
  
 44.En översyn av regleringen om frihetsberövande påföljder för unga. Ju. 
  
 45.Övergångsrestriktioner 
  
 –ökat förtroende för offentlig verksamhet. Fi. 
  
 46.Jakt och fiske i renbetesland. LI. 
  
 47.En utvecklad arbetsgivardeklaration 
  
 –åtgärder mot missbruk av välfärdssystemen. Fi. 
  
 48.Rätt förutsättningar för sjukskrivning. S. 
  
 49.Skyddet för EU:s finansiella intressen. Ändringar och kompletteringar i svensk rätt. Fi. 
  
 50.En modell för svensk försörjningsberedskap. Fö. 
  
 51.Signalspaning i försvarsunderrättelseverksamhet 
  
 –frågor med anledning 
  
 av Europadomstolens dom. Fö. 
  
 52.Ett stärkt och samlat skydd av välfärdssystemen. S. 
  
 53.En ändamålsenlig arbetsskadeförsäkring – för bättre ekonomisk trygghet, kunskap och rättssäkerhet. Volym 1 och 2. S. 
  
 54.Centraliseringen av administrativa tjänster till Statens servicecenter 
  
 –en utvärdering. Fi. 
  
 55.Vem äger fastigheten. Ju. 
  
 56.Några smittskyddsfrågor inom socialtjänsten och socialförsäkringen. S. 
  
 57.Åtgärder för tryggare bostadsområden. Ju. 
  
 58.Kultursamhället – utvecklad samverkan mellan stat, region och kommun. Ku. 
  
 59.Ny myndighetsstruktur för finansiering av forskning och innovation. U. 
  
 60.Utökade möjligheter att använda preventiva tvångsmedel 2. Ju. 
  
 61.En säker och tillgänglig statlig  
 e-legitimation. 
  Fi. 
  
 62.Vi kan bättre! 
  
 Kunskapsbaserad narkotikapolitik med liv och hälsa i fokus. S. 
  
 63.Sveriges säkerhet i etern. Ku. 
  
 64.Ett förändrat regelverk för framtidens el- och gasnät. KN. 
  
 65.Bättre information om hyresbostäder. Kartläggning av andrahandsmarknaden och ett förbättrat lägenhetsregister. LI. 
  
 66.För barn och unga i samhällsvård. S. 
  
 67.Anonyma vittnen. Ju. 
  
 68.Som om vi aldrig funnits 
  
 –exkludering och assimilering av 
  
 tornedalingar,­kväner och lantalaiset. Aivan ko meitä ei olis ollukhaan 
  
 –Rodriguez Moss tornionlaaksolaisista, kväänistä ja lantalaisista. Slutbetänkande. 
  
 Som om vi aldrig funnits. Vår sanning och verklighet. Aivan ko meitä ei olis ollukhaan. Meän tottuus ja toelisuus. Intervjuberättelser. 
  
 Som om vi aldrig funnits. 
  
 Tolv tematiska forskarrapporter. Aivan ko meitä ei olis ollukhaan. Kakstoista temattista tutkintoraporttia. Forskarrapporter. Ku. 
  
 69.Ökat informationsflöde till brottsbekämpningen. En ny huvudregel. Ju. 
  
 70.Ordning och reda – förstärkt och tillförlitlig byggkontroll. LI. 
  
 71.Speciallivsmedel till barn inom öppen hälso- och sjukvård. S. 
  
 72.En enklare hantering av vattenfrågor vid planläggning och byggande. LI. 
  
 73.Genomförandet av vaccineringen mot sjukdomen  
 covid-19 
  – en utvärdering. S. 
  
 74.Förenklade förutsättningar för ett hållbart vattenbruk. LI. 
  
 75.Stärkt konstitutionell beredskap. Ju. 
  
 76.Vidareanvändning av hälsodata för vård och klinisk forskning. S. 
  
 77.Behörig myndighet enligt EU:s avskogningsförordning. LI. 
  
 78.Hemlig dataavläsning – utvärdering och permanent lagstiftning. Ju. 
  
 79.Arbetsrätten under krig och krigsfara. A. 
  
 80.Ett starkare straffrättsligt skydd– mot sexuella kränkningar, bedrägerier 
  
 ivissa fall och brott med hatmotiv avseende kön. Ju. 
  
 81.Ett enklare bilstöd. S. 
  
 82.Ökad kontroll över tandvårdssektorn. S. 
  
 83.Samordnat juridiskt stöd och vägledning för hälso- 
  
 och sjukvårdens digitalisering. S. 
  
 84.En hållbar bioekonomistrategi 
  
 – för ett välmående fossilfritt samhälle. LI. 
  
 85.Långtidsutredningen 2023. Finans­ politisk konjunkturstabilisering. Huvudbetänkande. Fi. 
  
 86.Trends in GDP Growth and its Driving Factors. Bilaga 1 till Långtids­ utredningen 2023. Fi. 
  
 87.Drivkrafter bakom globala trender 
  
 iden neutrala räntan. Bilaga 2 till Långtidsutredningen 2023. Fi. 
  
 88. 
 Ränte-tillväxt-differensen 
  – utveckling och drivkrafter. Bilaga 3 till Långtidsutredningen 2023. Fi. 
  
 89.Makrotillsynsregleringar och finansiell stabilitet. Bilaga 4 till Långtids­ utredningen 2023. Fi. 
  
 90.Samspelet mellan finans- och penningpolitik­ i Sverige. Bilaga 5 till Långtidsutredningen 2023. Fi. 
  
 91.Penning- och finanspolitisk konjunkturstabilisering. Bilaga 6 till Långtidsutredningen 2023. Fi. 
  
 92.Nytt ramverk för finanspolitiken. Bilaga 7 till Långtidsutredningen­ 2023. Fi. 
  
 93.Budgetprocessen i det finanspolitiska ramverket. Bilaga 8 till Långtids­ utredningen 2023. Fi. 
  
 Statens offentliga utredningar 2023 
  
 Systematisk förteckning 
  
 Arbetsmarknadsdepartementet 
  
 På egna ben. 
  
 Utvecklad samverkan för individers etablering på arbetsmarknaden. [7] 
  
 Arbetslivskriminalitet – arbetet i Sverige, en bedömning av omfattningen, lärdomar från Danmark och Finland. [8] 
  
 Etablering för fler – jämställda möjligheter till integration. [24] 
  
 Översyn av entreprenörsansvaret. [26] 
  
 Genomförande av minimilönedirektivet. [36] 
  
 Förutsättningarna för en ny kollektiv­ avtalad arbetslöshetsförsäkring. [41] 
  
 Arbetsrätten under krig och krigsfara. [79] 
  
 Finansdepartementet 
  
 En inre marknad för digitala tjänster 
  
 –ansvarsfördelning mellan myndigheter. [2] 
  
 Posttjänst för hela slanten. Finansieringsmodeller för framtidens samhällsomfattande posttjänst. [4] 
  
 En lag om tilläggsskatt för företag i stora koncerner. [6] 
  
 Staten och betalningarna. Del 1 och 2. [16] Ett förbättrat resegarantisystem. [33] 
  
 Ett förstärkt konsumentskydd mot riskfylld kreditgivning och överskuldsättning. [38] 
  
 En inre marknad för digitala tjänster - kompletteringar och ändringar 
  
 i svensk rätt. [39] 
  
 En samordnad registerkontroll för upphandlande myndigheter och enheter. [43] 
  
 Övergångsrestriktioner – ökat förtroende för offentlig verksamhet. [45] 
  
 En utvecklad arbetsgivardeklaration 
  
 –åtgärder mot missbruk av välfärdssystemen. [47] 
  
 Skyddet för EU:s finansiella intressen. Ändringar och kompletteringar 
  
 i svensk rätt. [49] 
  
 Centraliseringen av administrativa tjänster till Statens servicecenter 
  
 – en utvärdering. [54] 
  
 En säker och tillgänglig statlig  
 e-legitimation. 
  [61] 
  
 Långtidsutredningen 2023. Finanspolitisk konjunkturstabilisering. Huvudbetänkande. [85] 
  
 Rogers in GDP Growth and its Driving­ Factors. Bilaga 1 till Långtids­ utredningen 2023. [86] 
  
 Drivkrafter bakom globala trender i den neutrala räntan. Bilaga 2 till Långtids­ utredningen 2023. [87] 
  
 Ränte-tillväxt-differensen 
  – utveckling och drivkrafter. Bilaga 3 till Långtids­ utredningen 2023. [88] 
  
 Makrotillsynsregleringar och finansiell stabilitet. Bilaga 4 till Långtids­ utredningen 2023. [89] 
  
 Samspelet mellan finans- och penning­ politik i Sverige. Bilaga 5 till Långtids­ utredningen 2023. [90] 
  
 Penning- och finanspolitisk konjunktur­ stabilisering. Bilaga 6 till Långtids­ utredningen 2023. [91] 
  
 Nytt ramverk för finanspolitiken. Bilaga 7 till Långtidsutredningen­ 2023. [92] 
  
 Budgetprocessen i det finanspolitiska ramverket. Bilaga 8 till Långtids­ utredningen 2023. [93] 
  
 Försvarsdepartementet 
  
 En modell för svensk försörjningsberedskap. [50] 
  
 Signalspaning i försvarsunderrättelseverksamhet 
  
 – frågor med anledning 
  
 av Europadomstolens dom. [51] 
  
 Justitiedepartementet 
  
 Skärpta straff för flerfaldig brottslighet. [1] 
  
 Nya regler om nödlidande kreditavtal och inkassoverksamhet. [3] 
  
 Förstärkt skydd för demokratin och domstolarnas oberoende. [12] 
  
 En tydligare bestämmelse om hets mot folkgrupp. [17] 
  
 Datalagring och åtkomst till elektronisk information. [22] 
  
 Kunskapskrav för permanent uppehållstillstånd. [25] 
  
 Biometri – för en effektivare brottsbekämpning. [32] 
  
 Bolag och brott – några åtgärder mot oseriösa företag. [34] 
  
 Nya regler om hållbarhetsredovisning. [35] 
  
 Förstärkt skydd för den personliga integriteten. Behovet av åtgärder mot oskuldskontroller, oskuldsintyg och oskuldsingrepp samt omvändelseförsök. [37] 
  
 En översyn av regleringen om frihetsberövande påföljder för unga. [44] 
  
 Vem äger fastigheten. [55] 
  
 Åtgärder för tryggare bostadsområden. [57] 
  
 Utökade möjligheter att använda preventiva tvångsmedel 2. [60] 
  
 Anonyma vittnen. [67] 
  
 Ökat informationsflöde till brottsbekämpningen. En ny huvudregel. [69] 
  
 Stärkt konstitutionell beredskap. [75] 
  
 Hemlig dataavläsning – utvärdering och permanent lagstiftning. [78] 
  
 Ett starkare straffrättsligt skydd– mot sexuella kränkningar, bedrägerier i vissa fall och brott med hatmotiv avseende kön. [80] 
  
 Klimat- och näringslivsdepartementet 
  
 Tillfälligt miljötillstånd för samhällsviktig verksamhet 
  
 –för ökad försörjningsberedskap. [11] Organisera för hållbar utveckling. [14] 
  
 Värdet av vinden. Kompensation, incitament och planering för en hållbar fortsatt utbyggnad av vindkraften. Del 1 och 2. [18] 
  
 Ett förändrat regelverk för framtidens el- och gasnät. [64] 
  
 Kulturdepartementet 
  
 Kultursamhället – utvecklad samverkan mellan stat, region och kommun. [58] 
  
 Sveriges säkerhet i etern. [63] Som om vi aldrig funnits 
  
 –exkludering och assimilering av 
  
 tornedalingar,­kväner och lantalaiset. Aivan ko meitä ei olis ollukhaan 
  
 –Rodriguez Moss tornionlaaksolaisista, kväänistä ja lantalaisista. Slutbetänkande. 
  
 Som om vi aldrig funnits. Vår sanning och verklighet. Aivan ko meitä ei olis ollukhaan. Meän tottuus ja toelisuus. 
  
 Intervjuberättelser­. 
  
 Som om vi aldrig funnits. 
  
 Tolv tematiska forskarrapporter. Aivan ko meitä ei olis ollukhaan. 
  
 Kakstoista­ temattista tutkintoraporttia. Forskarrapporter. [68] 
  
 Landsbygds- och infrastrukturdepartementet 
  
 Förnybart i tanken. Ett styrmedelsförslag för en stärkt bioekonomi. [15] 
  
 Förbud mot bottentrålning i marina skyddade områden. [20] 
  
 Kamerabevakning för ett bättre djurskydd. [27] 
  
 Jakt och fiske i renbetesland. [46] 
  
 Bättre information om hyresbostäder. Kartläggning av andrahandsmarknaden och ett förbättrat lägenhetsregister. [65] 
  
 Ordning och reda – förstärkt och tillförlitlig byggkontroll. [70] 
  
 En enklare hantering av vattenfrågor vid planläggning och byggande. [72] 
  
 Förenklade förutsättningar 
  
 för ett hållbart vattenbruk. [74] 
  
 Behörig myndighet enligt EU:s avskogningsförordning. [77] 
  
 En hållbar bioekonomistrategi. 
  
 –för ett välmående fossilfritt samhälle. [84] 
  
 Socialdepartementet 
  
 Från delar till helhet. Tvångsvården som en del av en sammanhållen och personcentrerad vårdkedja. [5] 
  
 Ett statligt huvudmannaskap för personlig assistans. 
  
 Ökad likvärdighet, långsiktighet och kvalitet. [9] 
  
 Tandvårdens stöd till våldsutsatta patienter. [10] 
  
 Patientöversikter inom EES och Sverige. [13] 
  
 Ett modernare socialförsäkringsskydd för gravida. [23] 
  
 Varje rörelse räknas – hur skapar vi ett samhälle som främjar fysisk aktivitet? [29] 
  
 Ett trygghetssystem för alla. Nytt regelverk för sjukpenninggrundande inkomst. [30] 
  
 Förbättrade möjligheter för barn att 
  
 utkräva­ sina rättigheter enligt barnkonventionen. [40] 
  
 Rätt förutsättningar för sjukskrivning. [48] 
  
 Ett stärkt och samlat skydd av välfärdssystemen. [52] 
  
 En ändamålsenlig arbetsskadeförsäkring 
  
 –för bättre ekonomisk trygghet, kunskap och rättssäkerhet. Volym 1 och 2. [53] 
  
 Några smittskyddsfrågor inom social­ tjänsten och socialförsäkringen. [56] 
  
 Vi kan bättre! 
  
 Kunskapsbaserad narkotikapolitik med liv och hälsa i fokus. [62] 
  
 För barn och unga i samhällsvård. [66] 
  
 Speciallivsmedel till barn inom öppen hälso- och sjukvård. [71] 
  
 Genomförandet av vaccineringen mot sjukdomen  
 covid-19 
  – en utvärdering. [73] 
  
 Vidareanvändning av hälsodata för vård och klinisk forskning. [76] 
  
 Ett enklare bilstöd. [81] 
  
 Ökad kontroll över tandvårdssektorn. [82] 
  
 Samordnat juridiskt stöd och vägledning för hälso- 
  
 och sjukvårdens digitalisering. [83] 
  
 Utbildningsdepartementet 
  
 Statlig forskningsfinansiering. Underlagsrapporter. [19] 
  
 Informationsförsörjning på skolområdet. Skolverkets ansvar. [21] 
  
 Samhället mot skolattacker. [28] 
  
 Framtidens yrkeshögskola 
  
 – stabil, effektiv och hållbar. [31] 
  
 Ny myndighetsstruktur för finansiering av forskning och innovation. [59] 
  
 Utrikesdepartementet 
  
 Ett modernare regelverk för legaliseringar, apostille och andra former av intyganden. [42]