So, Chad, how do you get around these distortions when you're researching productivity?

Well, you raised something really important, which is a big job of productivity researchers is trying to separate the signal of technological change from the noise of everything else.

so like you mentioned those commonly followed productivity numbers that we see are ratios of uh but the one that we talk about the most is labor productivity so it's output per worker hour so it's a ratio of output to input the input happens to be one worker one working one hour all productivity measures and there are many of them are in one basic way or another, a ratio of output to input or input or input.

But like you pointed out, those things can move around for reasons that have nothing to do with technological change.

So what you have to do as a researcher, well, sometimes we care about why they move around for reasons other than technical change, but given that productivity is probably our best measure of technological change, we have to do a lot of work to try to separate the signal from the noise.

And there are different ways to do it, but none of them are automatic.

And we don't have a little secret table that we can just go translate the number that gets reported into what's true technological progress.

Now,

So how do sales commissions affect housing prices? Can you quantify that?

That's the sixty-four billion dollar question.

There are some estimates out there.

I'm not sure if anyone's agreed on how big it actually is.

I can say that there are a lot of countries who have agent-mediated real estate transactions that end up with much lower effective transaction prices than the U.S.

So the U.S. historically has been up in this five and a half to six percent commission rate, and there are other places down in the one, the one and a half percent effective rate.

If you look at those other countries and say, "Are there reasons why selling houses should be fundamentally cheaper in those places?" You would say no, and certainly not by a multiple factor that we've seen.

Why hasn't that happened in residential real estate? Here's Chad Syverson again.