§ Mr. Sillarsasked the Chancellor of the Exchequer what was the growth of productive potential in each of the past 10 years; and in each of these years what was the rate of growth of gross domestic product.
§ Dr. GilbertCalculations of the growth of productive potential are derived from estimates of changes in productivity, the working population and hours of work. Quantitatively, the most important of these has been the growth of productivity. Estimates are made on a trend basis— that is, over a period of years rather than for individual years; it would not be meaningful to construct a series of annual data of changes in productive potential.
511WOver the past decade the trend rate of growth of productive potential is estimated to have been of the order of 3 per cent. per annum. However, it must be stressed that any estimates are subject to a margin of error.
Average Estimate of GDP at constant factor cost (1970 prices) Percentage increase on previous year 1964 1965 1966 1967 1968 1969 1970 1971 1972 1973 5.7 2.8 1.8 2.0 4.0 1.7 1.6 1.4 2.6 5.2 The average rate of growth of GDP over the period was 29 per cent. per annum. The small difference between this and the trend rate of growth of productive potential reflects differences in methods of estimation and a slight decline in the pressure of demand, as measured by the average level of unemployment, between the opening and closing years.