Growth Accounting When Technical Change is Embodied in Capital

Charles R. Hulten

No 3971, NBER Working Papers from National Bureau of Economic Research, Inc

Abstract: Many technological innovations are introduced through improvements in the design of new investment goods, thus raising the possibility that capital-embodied technical change may be a significant source of total factor productivity growth. There are, however, no systematic estimates of the size of the embodiment effect. This paper attempts to fill this gap by merging the estimates of quality change obtained from the price literature on quality change with a version of the conventional sources of growth model which allows for both embodied and disembodied technical change. This resulting estimates suggest that as much as 20 percent of the total factor productivity in growth U.S. manufacturing industry over the period 1949-83 is due to the embodiment effect. It is also found that for the equipment used in U.S. manufacturing, best practice technology may be as much as 23 percent above the average level of technical efficiency.

Date: 1992-01
Note: PR
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (239)

Published as American Economic Review, Vol. 82, no. 4 (1992): 964-980.

Downloads: (external link)
http://www.nber.org/papers/w3971.pdf (application/pdf)

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:nbr:nberwo:3971

Ordering information: This working paper can be ordered from
http://www.nber.org/papers/w3971

Access Statistics for this paper

More papers in NBER Working Papers from National Bureau of Economic Research, Inc National Bureau of Economic Research, 1050 Massachusetts Avenue Cambridge, MA 02138, U.S.A.. Contact information at EDIRC.
Bibliographic data for series maintained by ().