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The Equipment Hypothesis and U.S. Economic Growth

25 Pages Posted: 22 Feb 2008 Last revised: 27 Oct 2009

Alexander J. Field

Santa Clara University - Leavey School of Business - Economics Department

Abstract

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.

Keywords: Economic history, Economic growth, Productivity, Equipment investment

JEL Classification: D24, N12, O11, O47

Suggested Citation

Field, Alexander J., The Equipment Hypothesis and U.S. Economic Growth. Explorations in Economic History, Vol. 44, No. 1, January 2007. Available at SSRN: https://ssrn.com/abstract=1095952

Alexander J. Field (Contact Author)

Santa Clara University - Leavey School of Business - Economics Department ( email )

500 El Camino Real
Santa Clara, CA California 95053
United States
408 554 4348 (Phone)
408 554 2331 (Fax)

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