Estimating the Euler Equation for Aggregate Investment with Endogenous Capital Depreciation
Eleni Angelopoulou and
Sarantis Kalyvitis ()
Southern Economic Journal, 2012, vol. 78, issue 3, 1057-1078
This article looks at the empirical consequences of introducing endogenous capital depreciation in the standard neoclassical model with quadratic adjustment costs. To this end, we formulate an empirical specification that accommodates capital maintenance and utilization in the Euler equations for aggregate investment. The empirical estimates with data from the Canadian Survey on Capital and Repair Expenditures show that, in contrast to the existing literature, the performance of the Euler equations is improved when we account for the impact of variable capital depreciation.
JEL-codes: D92 E22 (search for similar items in EconPapers)
References: Add references at CitEc
Citations: View citations in EconPapers (2) Track citations by RSS feed
Downloads: (external link)
Working Paper: Estimating the Euler Equation for Aggregate Investment with Endogenous Capital Depreciation (2011)
This item may be available elsewhere in EconPapers: Search for items with the same title.
Export reference: BibTeX
RIS (EndNote, ProCite, RefMan)
Persistent link: https://EconPapers.repec.org/RePEc:sej:ancoec:v:78:3:y:2012:p:1057-1078
Access Statistics for this article
Southern Economic Journal is currently edited by Laura Razzolini
More articles in Southern Economic Journal from Southern Economic Association Contact information at EDIRC.
Bibliographic data for series maintained by Laura Razzolini (). This e-mail address is bad, please contact .