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Vous consultezCapital Obsolescence, Growth Accounting and Total Factor Productivity
AuteurPatrick Musso du même auteurGREDEG-CNRS and OFCE-DRIC, Sophia Antipolis, France
The stability of capital lifespan over time is a key assumption of growth accounting studies. However, many empirical works refute this hypothesis and suggest that the average service-life of capital goods has shown a decrease in the advanced economies since the 1970s. I show in this paper that this acceleration in capital obsolescence could strongly impact on traditional measures of Total Factor Productivity. For instance, a moderate increase in the capital retirement rate since the early 1970s could explain almost all the productivity slowdown observed in the US economy in the period 1974-2000.
JEL Classification: C80, E17, O47.
capital obsolescence, total factor productivity, productivity slowdown, mismeasurement hypothesis
PLAN DE L'ARTICLE
- 1 - Introduction
- 2 - Growth Accounting and the US Productivity Slowdown
- 3 - The Mismeasurement Hypothesis
- 4 - Lessons from Few Numerical Exercises
- 5 - Conclusion