Growth, Productivity, and the Rate of Return on Capital

40 Pages Posted: 15 Feb 2006

See all articles by Charles L Adams

Charles L Adams

affiliation not provided to SSRN

Bankim Chadha

affiliation not provided to SSRN

Date Written: May 1992

Abstract

This paper examines the ability of alternative classes of growth models to explain the historical experience of the U.S. economy. The potential returns to the U.S. from raising its investment rate in terms of both the level and growth rate of future output are then quantified. The long-run growth performance of the U.S. economy is found to be broadly consistent with the predictions of the neoclassical growth model. Endogenous growth models, which suggest a larger contribution of capital to growth and long-run effects of investment on the growth rate, do not seem to be supported by the data.

JEL Classification: D90

Suggested Citation

Adams, Charles L and Chadha, Bankim, Growth, Productivity, and the Rate of Return on Capital (May 1992). IMF Working Paper, Vol. , pp. 1-40, 1992. Available at SSRN: https://ssrn.com/abstract=884733

Charles L Adams (Contact Author)

affiliation not provided to SSRN

Bankim Chadha

affiliation not provided to SSRN

No Address Available

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