Capital-labor substitution and economic efficiency
TL;DR: In this article, the authors proposed a method to improve the quality of the service provided by the service provider by using the information of the user's interaction with the provider and the provider.
Abstract: Обсуждаются следующие темы: чистая теория производства, функциональное распределение дохода, технический прогресс, источники международных конкурентных преимуществ. Анализируются эластичность замещения между трудом и капиталом в обрабатывающей промышленности; производственные функции различного типа.
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01 Jan 2014
TL;DR: In this article, the authors argue that more capital will erode the economywide return on capital and that the assumption of high elasticity from time series is unsound, assuming a constant real price of capital despite the dominant role of rising prices in pushing up the capital/income ratio.
Abstract: Capital in the Twenty-First Century predicts a rise in capital’s share of income and the gap r g between capital returns and growth. In this note, I argue that neither outcome is likely given realistically diminishing returns to capital accumulation. Instead—all else equal—more capital will erode the economywide return on capital. When converted from gross to net terms, standard empirical estimates of the elasticity of substitution between capital and labor are well below those assumed in Capital. Piketty (2014)’s inference of a high elasticity from time series is unsound, assuming a constant real price of capital despite the dominant role of rising prices in pushing up the capital/income ratio. Recent trends in both capital wealth and income are driven almost entirely by housing, with underlying mechanisms quite different from those emphasized in Capital.
108 citations
TL;DR: In this article, a tax schedule imposes equal sacrifice on all taxpayers in loss of utility, and this property is preserved under re-indexing of the schedule under the assumption that the utility function must exhibit constant relative risk aversion.
106 citations
TL;DR: In this article, the authors consider the application of econometric general equilibrium modeling to the US economy and present a new version of the IGEM for the evaluation of proposed legislation on climate policy by the US Environmental Protection Agency (2012b).
Abstract: The point of departure for the study of the impact of energy and environmental policies is the neoclassical theory of economic growth formulated by Cass (1965) and Koopmans (1967). The long-run properties of economic growth models are independent of energy and environmental policies. However, these policies affect capital accumulation and rates of productivity growth that determine the intermediate-run trends that are important for policy evaluation. Heterogeneity of different energy producers and consumers is critical for the evaluation of energy and environmental policies. To capture this heterogeneity it is necessary to distinguish among commodities, industries and households. Econometric methods are essential for summarizing information on different industries and consumer groups in a form suitable for general equilibrium modeling. In this chapter, we consider the application of econometric general equilibrium modeling to the US – the economy that has been studied most intensively. The framework for our analysis is provided by the Intertemporal General Equilibrium Model (IGEM) introduced by Jorgenson and Wilcoxen (1998). The new version of the IGEM presented in this paper is employed for the evaluation of proposed legislation on climate policy by the US Environmental Protection Agency (2012b).
105 citations
TL;DR: A survey of nonlinear regression models with an emphasis on the theory of estimation and hypothesis testing rather than on computation and applications can be found in this article, where the authors discuss a variety of models and their applications.
Abstract: Publisher Summary This chapter discusses a survey of nonlinear regression models, with an emphasis on the theory of estimation and hypothesis testing rather than on computation and applications. The advent of advanced computer technology has made it possible for the econometrician to estimate an increasing number of nonlinear regression models. Nonlinearity arises in diverse ways in econometric applications. Perhaps the simplest and best-known case of nonlinearity in econometrics arises as the observed variables in linear-regression models. Another well-known case is the distributed-lag model in which the coefficients on the lagged exogenous variables are specified to decrease with lags in certain nonlinear fashion, such as geometrically declining coefficients. In both of these cases, nonlinearity appears only in parameters but not in variables. More general nonlinear models are used in the estimation of production functions and demand functions. Even a simple Cobb–Douglas production function cannot be transformed into linearity if the error term is added rather than multiplied.
105 citations
01 Nov 2006
TL;DR: The business value of information technology is estimated in terms of the impact of IT on technical efficiency, based on the constant elasticity of substitution stochastic production frontier model at three levels: firm, industry, and sector.
Abstract: The business value of information technology (IT) is an extremely important but highly controversial issue that has sparked a great deal of research during the past two decades. Closely related to the issue are the productivity paradox of information systems and the substitutability of IT stock for both traditional capital and labor. Numerous studies have been undertaken to either explain or dispel the paradox. This paper represents one significant extension to previous work and is a further effort to jointly investigate the business value issue, the paradox, and the potential of the substitution between IT capital and ordinary capital and labor, by estimating the IT business value in terms of the impact of IT on technical efficiency, based on the constant elasticity of substitution (known as CES) stochastic production frontier model, at three levels: firm, industry, and sector. The major findings include: the relationship between technical efficiency and IT investment is not robust with respect to the specifications of production frontiers; the productivity paradox is still existent, inconsistent with conventional wisdom, IT has substantial impacts on the five parameters associated with the CES production process; IT stock, traditional capital, and traditional labor are not pairwise substitutable; IT stock appears to be as important as capital, but it is not possible to use IT stock to replace the role of labor entirely; decreasing returns to scale are found irrespective of the levels of IT investments, and technical efficiency tends to decrease as IT investments increase; the industry-level analysis suggests that IT capital is more important for the services industries than for the manufacturing industries; and the sector analysis seems to indicate that the services sector is just slightly less technically efficient than the manufacturing sector.
104 citations
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TL;DR: In this article, the authors proposed a method to improve the performance of the system by using the information of the user's interaction with the system and the system itself, including the interaction between the two parties.
Abstract: В статье производится анализ агрегированной производственной функции, вводится аппарат, позволяющий различать движение вдоль такой функции от ее сдвигов. На основании сделанных в статье предположений делаются выводы о характере технического прогресса и технологических изменений. Существенное внимание уделяется вариантам применения концепции агрегированной производственной функции.
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01 Jan 1956TL;DR: In this paper, a very brief treatment of three questions relating to the history of our economic growth since the Civil War is given, namely: (1) How large has been the net increase of aggregate output per capita, and to what extent has this increase been obtained as a result of greater labor or capital input on the one hand and of a rise in productivity on the other? (2) Is there evidence of retardation, or conceivably acceleration, in the growth of per capita output? (3) Have there been fluctuations in the rate of growth of output, apart
Abstract: Introduction This paper is a very brief treatment of three questions relating to the history of our economic growth since the Civil War: (1) How large has been the net increase of aggregate output per capita, and to what extent has this increase been obtained as a result of greater labor or capital input on the one hand and of a rise in productivity on the other? (2) Is there evidence of retardation, or conceivably acceleration, in the growth of per capita output? (3) Have there been fluctuations in the rate of growth of output, apart from the shortterm fluctuations of business cycles, and, if so, what is the significance of these swings? The answers to these three questions, to the extent that they can be given, represent, of course, only a tiny fraction of the historical experience relevant to the problems of growth. Even so, anyone acquainted with their complexity will realize that no one of them, much less all three, can be treated satisfactorily in a short space. I shall have to pronounce upon them somewhat arbitrarily. My ability to deal with them at all is a reflection of one of the more important, though one of the less obvious, of the many aspects of our growing wealth, namely, the accumulation of historical statistics in this country during the last generation. For the most part, the figures which I present or which underlie my qualitative statements are taken directly from tables of estimates of national product, labor force, productivity, and the like compiled by others.
1,031 citations
903 citations