Factor substitution and factor-augmenting technical progress in the United States: A normalized supply-side system approach

Reference : Factor substitution and factor-augmenting technical progress in the United States: A ...


	Document type :	Scientific journals : Article
	Discipline(s) :	Social & behavioral sciences, psychology : Sociology & social sciences
	To cite this reference:	http://hdl.handle.net/10993/27870

Title :	Factor substitution and factor-augmenting technical progress in the United States: A normalized supply-side system approach
Language :	English
Author, co-author :	Klump, Rainer [University of Luxembourg > Rectorate > Rectorate]
	McAdam, Peter [> >]
	Willman, Alpo [> >]
Publication date :	2007
Journal title :	REVIEW OF ECONOMICS AND STATISTICS
Publisher :	M I T Press
Volume :	89
Issue/season :	1
Pages :	183-192
Peer reviewed :	Yes (verified by ORBi^lu)
ISSN :	0034-6535
City :	Cambridge
Abstract :	[en] Using a normalized CES function with factor-augmenting technical progress, we estimate a supply-side system of the U.S. economy from 1953 to 1998. Avoiding potential estimation biases that may have occurred in earlier studies and putting a high emphasis on data consistency, we obtain robust results not only for the aggregate elasticity of substitution but also for the parameters of labor and capital augmenting technical change. We find that the elasticity of substitution is significantly below unity and that technical progress shows an asymmetrical pattern where the growth of laboraugmenting technical progress is exponential, while that of capital is hyperbolic or logarithmic.
Permalink :	http://hdl.handle.net/10993/27870
DOI :	10.1162/rest.89.1.183

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