The Equipment Hypothesis and U.S. Economic Growth
Alexander J. Field
Santa Clara University - Leavey School of Business - Economics Department
Explorations in Economic History, Vol. 44, No. 1, January 2007
In several articles published in the 1990s, de Long and Summers argued that investment in producer durables had a high propensity to generate externalities in using industries, resulting in a systematic and substantial divergence between its social and private return. They maintained, moreover, that this was not the case for structures investment. Together, these claims constitute the equipment hypothesis. This paper explores the degree to which the history of U.S. economic growth in the twentieth century supports it.
Number of Pages in PDF File: 25
Keywords: Economic history, Economic growth, Productivity, Equipment investment
JEL Classification: D24, N12, O11, O47Accepted Paper Series
Date posted: February 22, 2008 ; Last revised: October 27, 2009
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