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Capital deepening

About: Capital deepening is a research topic. Over the lifetime, 5203 publications have been published within this topic receiving 230297 citations.


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Journal ArticleDOI
TL;DR: In this article, the authors compare labor and total factor productivity (TFP) in France, Japan, the United Kingdom and the United States in the very long (since 1890) and medium (since 1980) runs.
Abstract: This study compares labor and total factor productivity (TFP) in France, Japan, the United Kingdom and the United States in the very long (since 1890) and medium (since 1980) runs. During the past century, the United States has overtaken the United Kingdom and become the leading world economy. During the past 25 years, the four countries have also experienced contrasting advances in productivity, in particular as a result of unequal investment in information and communication technology (ICT).The past 120 years have been characterized by: (i) rapid economic growth and large productivity gains in all four countries; (ii) a long decline of productivity in the United Kingdom relative to the United States, and to a lesser extent also to France and Japan, a relative decline that was interrupted by the second world war (WW2); (iii) the remarkable catching-up to the United States by France and Japan after WW2, that stopped in the case of Japan during the 1990s. Capital deepening (at least to the extent this can be measured) accounts for a large share of the variations in performance; increasingly during the past 25 years, this has meant ICT capital deepening. However, the capital contribution to growth varies considerably over time and across the four countries, and it is always less important, except in Japan, than the contribution of the various other factors underlying TFP growth, such as, among others, labor skills, technical and organizational changes and knowledge spillovers. Most recently (in 2006), before the current financial world crisis, hourly labor productivity levels were slightly higher in France than in the United States, and noticeably lower in the United Kingdom (by roughly 10%) and even lower in Japan (30%), while TFP levels are very close in France, the United Kingdom and the United States, but much lower (40%) in Japan.

37 citations

Posted Content
TL;DR: The empirical analysis of the paper as discussed by the authors suggests that an FX policy objective and concerns about an overheating of the domestic economy have been the two main reasons for the re-introduction and persistence of capital controls over the past decade.
Abstract: The empirical analysis of the paper suggests that an FX policy objective and concerns about an overheating of the domestic economy have been the two main motives for the (re-)introduction and persistence of capital controls over the past decade. Capital controls are strongly associated with countries having significantly undervalued exchange rates. Capital controls also appear to be less motivated by worries about financial market volatility or fickle capital flows per se, but rather by concerns about capital inflows triggering an overheating of the economy – in the form of high credit growth, rising inflation and output volatility. Moreover, countries with a high level of capital controls, and those actively implementing controls, tend to be those that have fixed exchange rate regimes, a non-IT monetary policy regime and shallow financial markets. This evidence is consistent with capital controls being used, at least in part, to compensate for the absence of autonomous macroeconomic and prudential policies and effective adjustment mechanisms for dealing with capital flows.

37 citations

Journal ArticleDOI
TL;DR: In this article, the roles of capital-labor substitution, energy substitution, and technological change as sources of labor productivity growth were identified as a major cause of the slowdown in productivity growth.

37 citations

Journal ArticleDOI
TL;DR: In this article, the authors examined economic growth in old and new member countries of the European Union (EU-15 and EU-12) during the years of 1994-2000 and 2001-2008 mainly due to changes in information and communication technology (ICT) capital development.
Abstract: The paper examines economic growth in old and new member countries of the European Union (EU-15 and EU-12) during the years of 1994–2000 and 2001–2008 mainly due to changes in information and communication technology (ICT) capital development. The first group EU-15 is presented by old EU countries and the second group EU-12 is presented by new member countries that joined the EU in 2004–2007. The threefactor Cobb-Douglas production function is estimated through the panel general least squares method. The input factors that might influence the economic growth are labour, ICT capital services and non-ICT capital services. Since ICT capital growth data are not available for all selected economies, the groups of countries were reduced to EU-14 and EU-7. The estimated panel production functions confirmed that the average growth of GDP in the EU-7 countries was supported by the stable growth of labour quantity and ICT-capital and increasing total factor productivity. A short-term drop in non-ICT capital growth with follow-up stagnation was caused rather by lower labour productivity. The research discovered that the drop in GDP growth in the EU-14 countries was a result of the slower growth of non-ICT capital and total factor productivity and the stagnated growth of ICT capital with low elasticity, and showed that even the compensation of growth in labour quality did not prevent a decrease in total factor productivity and economic growth.

37 citations

Posted Content
TL;DR: In this article, the authors examined the time series behavior of investment in physical capital, human capital (comprising education and health) and output in a co-integration framework, taking growth of primary gross enrolment rate and a dummy for structural adjustment programme (openness which has been initiated in 1991) as exogenous variables in India from 1960 to 2006.
Abstract: This study examines the time series behavior of investment in physical capital, human capital (comprising education and health) and output in a co-integration framework, taking growth of primary gross enrolment rate and a dummy for structural adjustment programme (openness which has been initiated in 1991) as exogenous variables in India from 1960 to 2006. The results suggest that physical capital investment has no long-run nor short-run effect but the human capital investment has significant long-run effect on per capita GNP; the stock of human capital measured by primary gross enrolment rate (lagged by three years) and openness is found to have a significant effect on growth of per capita GNP. The Generalized Impulse Response Function confirms that the innovation in per capita GNP growth can only explain the movements of the growth of per capita GNP (itself) and investment in education human capital positively and significantly only for a short period of time but does not explain the movements of the investment in physical capital and health human capital. Moreover, the innovation in change in education human capital investment significantly and positively explains the movement of the changes in education human capital investment (itself), health human capital investment and growth of GNP per capita; the innovation in health human capital investment significantly explains the changes of education and health human capital investment only. This study may help towards policy modeling of economic growth in India, taking into account the relevance of endogenous growth.

37 citations


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Performance
Metrics
No. of papers in the topic in previous years
YearPapers
202326
202242
202126
202031
201932
201848