The Level of Productivity in Traded and Non-Traded Sectors for a Large Panel of Countries

This paper explains in detail the construction of series for productivity in the traded and nontradedsectors for a panel of 56 countries spanning 1989–2012. The level of productivity ineach sector is defined as real value added per worker in constant 2005 Purchasing PowerParity (PPP) U.S. dollars. To construct these series, we collect industry-level data fromseveral sources, and classify individual industries as traded/non-traded using their ratio ofexports to value added. Finally, we aggregate the industry data up to a traded sector and anon-traded sector, accordingly. This new dataset has two main advantages relative to existingdatasets: (i) it defines more finely the traded/non-traded sectors, by drawing on much moredisaggregated industry source data; and (ii) it allows for meaningful comparisons of the levelof productivity across countries/sectors because sectoral productivity is adjusted by its ownprice level.