Information and communication technology equipment seems to be everywhere in our society. Places such as your own home, in your classrooms, in factories, and even in peoples pockets. The Internet was not even thought of 20 years ago. The Internet allows people in different countries interact and communicate with each other just through clicking on certain objects on the Internet. The has been a dramatic increase of growth investment from 1.7 percent per year over 1981- 1988 to 11.9 percent over 1995- 2000. Labor input is another primary source of growth. It really has went up since the period of 1995 through now because of the increase in hours worked.

The growth in Canada's has been traced back to three data series which are: 1) an index of the growth in investment, 2) an index of the growth in capital stock, 3) an index of the growth in capital services from 1981-2000. "For a clear view of aggregate trends, average annual growth rates (in terms of both quantities and prices) are presented in Table 2 for each series for the major asset classes and for the entire period 1981-2000, and for three subperiods: 1981-88, 1988-95, and 1995- 2000.Canada rose about 3 percent per year from 1981-88, and then it fell to 1.5 percent per year from 1988-95. After that it rose back up to 5 percent in the second half on the 1990's.

Investments in the assets classes grew at a higher pace from 1995-2000 than the period of 1981-88. Capital stock and capital services show that the post 1995 period has had a huge growth in capital stock. In the asset level, equipment has grew through all periods, such as machinery and equipment and structures experienced a big slowdown in the 1988-95 period.

"The growth of aggregate capital services (the log represents the growth rate) is decomposable as follows: The first term on the right hand side will be referred to as the "within quality effect," which measures substitution and capital quality within distinct asset classes. The second term represents the "between quality effect," which measures substitution between distinct asset classes. The last term is the "capital accumulation effect," which measures capital stock accumulation."

Table 3 presents the contribution to the growth in total fixed capital services from each component from 1981 to 2000 and subperiods.

For all periods and all assets classes, the total quality effect is driven by the within quality effect. But there has been an increase of 0.7 percent of capital services between 1981-88 and 1995-2000. The growth of capital services along with the growth in labor input productivity are the three primary determinants of the economic growth in output.

Table 4 shows that from 1981 to 2000, Canada's labor productivity rose at a rate of 1.4 percent. Table 4 also shows a labor productivity rise during the 1980's and early 1990's.

During 1995- 2000, labor productivity grew 1.7 percent per year in the business sector. "Table 5 illustrates in the second column, for the period 1981-88, that output grew at 3.3 percent per year, of which aggregate capital contributed 1. 4 percent, labor input 1.7 percent, and multifactor productivity 0.2 percent."

So to conclude, both Canada and The United States the growth in output in the post- 1995 period has had a major increase in the earlier part of this decade and many decades before this one. The different types of technology that was have now has increased heavily since the decades before out time. Most people do not even have to leave the homes because of the modern technology we have these days, its amazing. The biggest thing that people look at about all the new technology is the recovery in the multifactor productivity performance. It was 1.0 percent for Canada and 1.3 percent for the United States.

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References

Knowledge, technology and economic growth

OUP: Information Technology, Productivity, and Economic Growth

Information Technology and Economic Growth

WebEc - Economic Development, Technological Change and Growth

EconPapers: Information Technology and Economic Growth