On the Unimportance of Machinery

24 Pages Posted: 20 Mar 2008

See all articles by Alexander J. Field

Alexander J. Field

Santa Clara University - Leavey School of Business - Economics Department

Abstract

Economists and economic historians tend to use the terms capital and machinery interchangeably, even though machinery rarely constitutes one fifth and sometimes is as little as one tenth of a nation's reproducible tangible assets. This habit can distort the way economists think and talk about important issues. In economic history, disproportionate attention to machinery helps explain why the "Habbakuk" debate, which is now several decades old, has been premised on the need to rationalize empirical regularities the opposite of those in need of explanation. In manufacturing, and, indeed, in the economy in the aggregate, the United States was less, not more capital intensive than Britain in 1860.

Keywords: Capital, Machinery, Fixed Assets, Technical Choice

JEL Classification: D24, N61, N63, O14

Suggested Citation

Field, Alexander J., On the Unimportance of Machinery. Explorations in Economic History, Vol. 22, No. 4, 1985. Available at SSRN: https://ssrn.com/abstract=1111422

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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