"Productivity" is a perfect example of the pseudscience underpinning economics
Economists are famously fragile about their field; after all, this is the field that created a fake Nobel prize to give its practitioners the veneer of credibility and empiricism that actual sciences enjoy.
A favored tactic among economists is the use of complex equations that make it hard for nonpractitioners to spot the cards they're palming. Just as con-artists like to lard complexity into bar-bets to make it hard to calculate the odds, and just as casino games like craps add extra lines and payouts the table to confound your ability to spot the house advantage, neoliberal economics has weaponized equations to exclude its critics from the discussion. Sometimes, this shitty math is so terrible that it threatens the whole planetary economy.
On Economics from the Top Down, York University PhD candidate in economics Blair Fix takes on the economic logic of measuring "productivity," demonstrating how it uses circular reasoning to prove that underpaid workers are receiving a fair wage.
The measurement of "productivity" began with John Bates Clark, who was responding to Marxist threats to the economic dominance of capitalism, and explicitly set out to find a way to measure "productivity" that would prove that workers' low wages were fair ("It is the purpose of this work to show that the distribution of the income of society is controlled by a natural law, and that this law, if it worked without friction, would give to every agent of production the amount of wealth which that agent creates," -The Distribution of Wealth).
From this shake foundation, economists have erected a towering edifice of theory and math that "proves" over and over that workers get the pay they deserve. But this proof depends on axioms that are designed to produce the desired outcome. As Fix shows, the closer you peer at these axioms, the more circular they become.
I've taken the liberty of creating a step by step guide for how to test marginal productivity theory and guarantee that the theory succeeds:
1. Find an income-accounting equation that is true by definition.
2. Forget that you are dealing with an accounting equation.
3. Pick a form of income (in your equation) that you want to explain.
4. Given your choice, look at the opposite side of your accounting equation.
5. Convince yourself that this opposite side no longer measures income. It now measures output.
6. Regress the two sides of your accounting equation.
7. Celebrate when you find a strong correlation.
8. Claim you that have found evidence that productivity explains income.
9. Never tell anyone that your results were guaranteed because they followed from an income-accounting equation. (This step is unnecessary if Step 2 is successful).
No, Productivity Does Not Explain Income [Blair Fix/Economics from the Top Down]
(via Naked Capitalism)