Investment and Technical Progress in the G7 Countries and Australia

83 Pages Posted: 16 May 2011

See all articles by Ernst Juerg Weber

Ernst Juerg Weber

The University of Western Australia - UWA Business School

John Pawley

The University of Western Australia - UWA Business School

Date Written: May 15, 2011

Abstract

The vintage model of capital accumulation predicts that technical progress depends on the installation of new capital equipment. In this paper it is found that investment raises labor productivity in the G7 countries and Australia. This finding implies that the decline in investment during the global financial crisis will have a long lasting detrimental effect on labor productivity and hence wages.

Suggested Citation

Weber, Ernst Juerg and Pawley, John, Investment and Technical Progress in the G7 Countries and Australia (May 15, 2011). Available at SSRN: https://ssrn.com/abstract=1842844 or http://dx.doi.org/10.2139/ssrn.1842844

Ernst Juerg Weber (Contact Author)

The University of Western Australia - UWA Business School ( email )

Crawley, WA 6009
Australia

John Pawley

The University of Western Australia - UWA Business School ( email )

Crawley, 6009
Australia

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