The Economy: The Limits of Productivity

Should a pianist be paid more if he manages to zip through a concert in half the usual time? The answer, obviously, is no, but the question is not as silly as it sounds. The pay increases that the Government allows during Phase II are supposed to be tied largely to productivity —the value of output per man-hour.

Today almost two-thirds of all U.S. workers do not manufacture products. They provide services, such as playing pianos, performing surgery, repairing dishwashers, designing packages, arresting muggers and selling and leasing almost anything. The means of gauging—much...

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