Countries that shift from a manufacturing-oriented economy to a service-oriented economy sometimes see their productivity growth decline over time.This phenomenon is called:
A)Service Shrink
B)Deming's Decline
C)State Utility
D)Baumol's Disease

Question

Countries that shift from a manufacturing-oriented economy to a service-oriented economy sometimes see their productivity growth decline over time.This phenomenon is called:
A)​Service Shrink
B)​Deming's Decline
C)​State Utility
D)​Baumol's Disease

Quizplus · Accepted Answer

Baumol's Disease is a phenomenon where countries that shift from a manufacturing-oriented economy to a service-oriented economy experience a decline in productivity growth over time. This is because the productivity growth in the manufacturing sector is typically higher than in the service sector, leading to an overall decline in productivity growth as the economy shifts towards services.

Countries That Shift from a Manufacturing-Oriented Economy to a Service-Oriented