The determinants of capital intensity in Japan and the US |
| |
| Institution: | 1. Department of Economics, Management and Quantitative Methods, University of Milan, via Conservatorio 7, 20122 Milan, Italy;2. Department of Applied Mathematics and Sciences, Khalifa University, PO Box 127788, Abu Dhabi, UAE;3. School of Accounting, Economics and Finance, University of Wollongong, Northfields Avenue, Wollongong 2522 NSW, Australia;4. Department of Mathematics and Statistics, Acadia University, 2011 Acadia University, Wolfville, Nova Scotia, Canada;5. Department of Economics and Statistics “Cognetti de Martiis”, University of Turin, Lungo Dora Siena 100A, 10153, Turin, Italy;1. 2424 Maile Way, Saunders Hall 542, University of Hawai‘i, Honolulu, HI 96822, USA;2. Keio University, University of Hawai‘i, and RIETI, 2424 Maile Way, Saunders Hall 542, University of Hawai‘i, Honolulu, HI 96822, USA;1. Bay Atlantic University, USA;2. Rutgers University, USA;3. Bahçe?ehir University, TR, Turkey |
| |
| Abstract: | We estimate the determinants of capital intensity in Japan and the US, characterized by striking different paths. We augment an otherwise standard Constant Elasticity of Substitution (CES) model with demand-side considerations, which we find especially relevant in the US. In this augmented setting, the elasticity of substitution between capital and labor is placed between 0.74 and 0.90 in Japan, and around 0.30 in the US. We also find evidence of biased technical change, which is capital-saving in Japan but labor-saving in the US. These differences help us explain the diverse experience in the capital deepening process of these economies, and lead us to conclude that demand-side drivers, quite relevant in the US, may also be relevant to account for different growth experiences. A close look at the nature of technological change is also needed before designing one-size-fits-all industrial, economic growth, and/or labor market policies. |
| |
| Keywords: | Capital intensity Biased technological change Elasticity of substitution Capacity utilization rate Employment |
| 本文献已被 ScienceDirect 等数据库收录！ |
|
