The paradox: The computing revolution has not generated the productivity growth hoped for by many of its proponents.

Possible reasons:

• Productivity does not measure the “right” things. I asked John Wiliams (chairman of the New York Fed) what he thought about the Solow paradox. This was his response, common among economists: classical productivity measurements do not measure the quality of life improvements brought about by e.g. search, GPS, etc.
• Computers might actually decrease our ability to think creatively outside the heavy constraints imposed by any one software solution.
• Productivity gains are offset by the need for expensive software engineers & technicians.

Reading

• McKinsey report
• Locklin post