Investment and Technical Progress in the G7 Countries and Australia
83 Pages Posted: 16 May 2011
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: 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
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