The relationship between factor shares and economic development |
| |
| Authors: | Brad Sturgill |
| |
| Affiliation: | 1. Department of Industrial Economics, Tamkang University, Taiwan;2. Department of Banking and Finance, Tamkang University, Taiwan;1. Economics and Finance Department, EDHEC Business School, 393, Promenade des Anglais, BP3116, 06202 Nice Cedex 3, France;2. Finance Department, ESSEC Business School, 1, av. Bernard Hirsch 95000 Cergy, France;1. Department of Economics, Cornell University, United States;2. Nova School of Business and Economics, Universidade Nova de Lisboa, Lisboa, Portugal;1. New York Institute of Technology, Campus 851, Road 3828, Block 388, Adliya, P.O. Box 11287, Bahrain;2. University of Pierre and Marie Curie UFR 929, 4 Place Jussieu, 75005 Paris, France |
| |
| Abstract: | The stability of factor shares has long been considered one of the “stylized facts” of macroeconomics. Most factor share studies, however, acknowledge only two factors of production (total capital and total labor), which yields misleading results. I distinguish between reproducible and non-reproducible factors of production. I disentangle physical capital’s share from natural capital’s share and human capital’s share from unskilled labor’s share. Results reveal that non-reproducible factor shares decrease with the stage of economic development, and reproducible factor shares increase with the stage of economic development. This evidence suggests that studies relying on the macroeconomic paradigm of constant factor shares should be revisited. The evidence also supports endogenous growth models that allow technical progress to manifest itself via changes in factor shares. |
| |
| Keywords: | |
| 本文献已被 ScienceDirect 等数据库收录！ |
|
