ABSTRACT
Output is made by combining different inputs. The logical way to proceed, then, would be to examine the quantity and quality of the various inputs with a view to identifying how efficiently they have been used. E. F. Denison’s procedure is to identify changes in the amounts of the various inputs - labour, capital, land - and in their quality - for example, the educational standards of labour - and then compare the growth contribution from the sources with the total growth of output. So for the technology chosen to be systematically different in Scotland from that chosen in the rest of the UK, there should be some systematic differences in the relative cost of inputs. Information about UK earnings has been collected for some time by the Department of Employment and its predecessors, and some details for Scotland have been available for years since 1960.
