Output and employment in the Scottish service sector

Dewhurst, John and Lythe, Charlotte (1984) Output and employment in the Scottish service sector. Quarterly Economic Commentary, 9 (4). pp. 69-77. ISSN 0306-7866

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The work described in this paper has its origin in two studies. For several years the authors have been working on an econometric model for Scotland, details of which will be published shortly (Dewhurst and Lythe (1981)). In this model, Scottish output is treated as the sum of the output in different industries. In each industry, output is modelled as dependent upon demand, and employment as dependent on output. So the modelling required some preliminary analysis, albeit at fairly aggregative level, about the determinants of output and employment in the Scottish Service Sector. The more immediate background to this study, however, is a project undertaken for the Industry Department for Scotland, in which the authors have constructed an output index for the service sector for Scotland from 1962 to 1980 and have undertaken some preliminary investigation of what might have explained the behaviour of output, employment and labour productivity in Scotland over these years. The authors are grateful to the Department for permission to publish this paper before the full reports of their work (Dewhurst, Lythe and Peterson (1984)) are available. They wish to make i t clear that the procedures they have used in this study are their own responsibility, and that the opinions they express in this paper are their own, freely given.