Standard economic theories have severe difficulties in simultaneously explaining a number of key aggregate empirical facts: i) there are substantial differences in capital-labor ratios across time ii) despite continuously increasing capital-labor ratios, both factors still earn non-negligible...

Standard economic theories have severe difficulties in simultaneously explaining a number of key aggregate empirical facts: i) there are substantial differences in capital-labor ratios across time ii) despite continuously increasing capital-labor ratios, both factors still earn non-negligible...

The Japanese Consumer Price Index (CPI) is considered to be upwardly biased. This paper estimates the Engel curve based on National Survey of Family Income and Expenditure data to measure the bias. The estimated annual bias for the period 1989 to 2004 is 0.5 percentage points. Correcting the...