U.S. Competitiveness:

Assessing the Impact of Government Activities on Productivity and Living Standards

T-GGD-95-196: Published: Sep 28, 1995. Publicly Released: Sep 28, 1995.

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GAO discussed U.S. competitiveness and the impact of government activities on the U.S. economy and living standards. GAO noted that: (1) the definition of U.S. competitiveness has shifted from comparisons of U.S. export market shares to a broader emphasis on productivity growth and improvements in living standards; (2) advances in living standards have historically been tied to technological progress and market expansion, but productivity growth is the most important determinant; (3) productivity can be increased by more capital, better technology, a higher quality workforce, improved management, and government activities that positively impact these factors; (4) the federal government can help increase productivity by decreasing the national debt, dedicating a greater portion of the federal budget to investment spending such as for infrastructure, linking federal technology programs to productivity, improving workforce training programs, and encouraging quality management practices; and (5) although it is difficult to quantify the impact of government activities on competitiveness, focusing on such assessments would introduce a discipline that would go beyond only considering the cost of government operations and would help ensure that government activities do not detract from competitiveness.

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