Topic
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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TL;DR: In this paper, the authors show that the empirical link between investment and growth in the OECD countries is fully consistent with the Solow model and that the evidence of excess returns to equipment investment is tenuous.
Abstract: The recent literature on the sources of economic growth has challenged the traditional growth accounting of the Solow model, which assigned a relatively limited role to capital deepening. As part of this literature, De Long and Summers have argued in two papers that the link between equipment investment and economic growth across countries is stronger than can be generated by the Solow model. Accordingly, they conclude that such investment yields important external benefits. However, their analysis suffers from two shortcomings. First, De Long and Summers have not conducted any formal statistical tests of the Solow model. Second, even their informal rejection of the model fails to survive reasonable tests of robustness. We formally test the predictions of the Solow model using De Long and Summers' data. Our results cast doubt on the existence of externalities to equipment investment. In particular, we find that the empirical link between investment and growth in the OECD countries is fully consistent with the Solow model. Moreover, for De Long and Summers' full sample, the evidence of excess returns to equipment investment is tenuous.
106 citations
TL;DR: A survey of research in the distribution of labor incomes in which human capital theory serves as an organizing principle can be found in this article, where the role played by individual and family optimizing decisions in human capital investments is brought back within the mainstream of economic theory and within its analytical and econometric tools.
Abstract: The traditional studies of income distribution, a field with which economists are becoming increasingly concerned, must be described as basically sociological. The ascendancy of the human capital approach can be viewed as a reaction of economists to this non-economic, though certainly not irrelevant, tradition. In stressing the role played by individual and family optimizing decisions in human capital investments, important aspects of income determination are brought back within the mainstream of economic theory and within the power of its analytical and econometric tools. Human capital is not the only element of choice in the analysis of income distribution . Nevertheless, it appears that the subject of human capital investments lends itself to a more systematic and comprehensive analysis of wage differentials, than each of the other factors. The following is a description of research in the distribution of labor incomes in which human capital theory serves as an organizing principle. It is, in part, a sequel to my 1970 survey and, in part, a report of ongoing research of my own and of others.
106 citations
16 May 2007
TL;DR: In this paper, a group of contributors examines both the advantages and the pitfalls of restricting capital mobility in these emerging nations and evaluates their effectiveness in altering the maturity of the resulting external debt and reducing macroeconomic vulnerability.
Abstract: Some scholars argue that the free movement of capital across borders enhances welfare; others claim it represents a clear peril, especially for emerging nations. In "Capital Controls and Capital Flows in Emerging Economies", an esteemed group of contributors examines both the advantages and the pitfalls of restricting capital mobility in these emerging nations. In the aftermath of the East Asian currency crises of 1997, the authors consider mechanisms that eight countries have used to control capital inflows and evaluate their effectiveness in altering the maturity of the resulting external debt and reducing macroeconomic vulnerability. This volume is essential reading for all those interested in emerging nations and the costs and benefits of restricting international capital flows.
106 citations
TL;DR: In this article, the authors used the Malmquist index approach to decompose productivity growth into two components, technological progress and efficiency change, and found that although China's capital stock has accumulated at record speed in recent years, TFP growth slowed down significantly during 1995-2001.
Abstract: This study estimates and analyzes provincial productivity growth in China for the period 1979–2001. The Malmquist Index approach allows us to decompose productivity growth into two components, technological progress and efficiency change. Considerable productivity growth was found for most of the data period, but it was accomplished mainly through technological progress rather than efficiency improvement. Although China's capital stock has accumulated at record speed in recent years, our findings show that TFP growth slowed down significantly during 1995–2001. The study thus raises serious questions about whether China's recent growth pattern is consistent with its comparative advantages, and whether its reliance on capital accumulation can be sustained in the long run.
105 citations
TL;DR: In this article, the authors examine the behavior of capital controls in 78 countries over the period 1995-2011 and find that capital controls are remarkably acyclical, that is, Booms and busts in aggregate activity are associated with virtually no movements in capital controls.
105 citations