National income accounts view most business expenditures on intangible goods as acquisitions of intermediate inputs that get entirely used up in the production of final output. After arguing against this convention, I construct a data set to document firms' expenditures on an identifiable list...

This paper shows that because growth models in the tradition of Solow's and Romer's are framed in terms of production functions, they are equally subject to a criticism developed by, among others, Phelps Brown (1957), Simon (1979a), and Samuelson (1979). These authors argued that production...

We use a CES production function with no restrictions on technical bias to derive relationships between the growth in relative factor shares and (i) the capital to labor ratio and (ii) the ratio of marginal products. These relationships constitute a parsimonious specification used to identify...

We present an application of the Dynamic Programming (DP) and of the Maximum Principle (MP) to solve an optimization over time when the production function is linear in the stock of capital (Ak model). Two views of capital are considered. In one, which is embraced by the great majority of...

According to the national accounts of Iran, during the period of 1988-2003 the annual change in inventories in this economy was highly variable and averaged 7.3 percent of GDP if calculated at current prices. In an ideal economy with no distortions, change in inventories should be zero on...

According to the national accounts of Iran, during the period of 1988-2003 the annual change in inventories in this economy was highly variable and averaged 7.3 percent of GDP if calculated at current prices. In an ideal economy with no distortions, change in inventories should be zero on...

We present in this paper the panel econometrics estimation approach of measuring the technical change and total factor productivity (TFP) growth of 30 Chinese provinces during the period of 1993 to 2003. The random effects model with heteroscedastic variances has been used for the estimation of...

This paper reassesses the link between ICT prices, technology, and productivity. To understand how the ICT sector could come to the rescue of a whole economy, we extend a multi-sector model due to Oulton (2012) to include ICT services (e.g., cloud services) and use it to calibrate the...

This study considers the Tobin's q of a ‘multi-product' firm with fixed capital goods. This modified version of Tobin's q includes a share of the fixed capital goods in a firm's investment. A firm in a developing economy, such as a South Korean chaebol, catches up the world frontier technology...

I propose a new decomposition of aggregate total factor productivity. I model productivity as an index of unmeasured factors of production, and decompose the conditional factor demand for this index. With this model of productivity, changes in the price of labor or capital cause substitution to...