Labor productivity

Definition

Labor productivity refers to the amount of goods or services that can be produced by a worker in a given amount of time. It is a measure of how efficient and effective workers are in producing output.

Related terms

Capital: Capital refers to the tools, machinery, equipment, and technology used in production. An increase in capital can lead to higher labor productivity.

Specialization: Specialization refers to when individuals or firms focus their efforts on producing certain goods or services. Specialization can increase labor productivity as workers become more skilled at performing specific tasks.

Technological advancements: Technological advancements refer to improvements and innovations in technology that make production processes more efficient. These advancements can lead to increased labor productivity.