 Output, Capital, and Labor in the Short, and Long-Run*Daniel Levy () Post-Print from HAL Abstract: Using a new series of capital stock and frequency domain analysis, this paper provides new empirical evidence on the relative importance of capital and labor in the determination of output in the short and long-run. Contrary to the common practice in the traditional growth accounting literature of assigning weights of 0.3 and 0.7 to capital and labor inputs respectively, the evidence presented here suggests that capital is a far more important factor than labor for determination of output at and near the zero frequency band. Furthermore, I show that the zero-frequency labor elasticity of output may well be close to zero, or even zero. Additional findings reported here support the traditional accelerator model of investment as a good description of the long-run investment process. Keywords: Growth Accounting; Capital Investment; Output Fluctuation; Employment; Business Cycles and Aggregate Fluctuation; Frequency Domain Analysis; Spectrum and Cross-Spectrum; Coherence; Phase Shift; Gain; Zero-Frequency; Capital and Labor (search for similar items in EconPapers) Published in Southern Economic Journal, 1994, 60 (4), pp.946-960. ⟨10.2307/1060432⟩ Downloads: (external link) Related works: Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text Persistent link: https://EconPapers.repec.org/RePEc:hal:journl:hal-02382783 DOI: 10.2307/1060432 Access Statistics for this paper More papers in Post-Print from HAL |
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