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IT and beyond: the contribution of heterogeneous capital to productivity

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  • Daniel Wilson

Abstract

This paper explores the relationship between capital composition and productivity using a unique and remarkably detailed data set on firm-level investment in the U.S. Using cross-sectional and longitudinal regressions, I find that several capital types, including computers, communications equipment, and software, are associated with current and subsequent years’ productivity. The implied marginal products are derived and compared to official data on rental prices; substantial differences exist for a number of key capital types. I also provide evidence of complementaries and substitutabilities among capital goods — a rejection of the common assumption of perfect substitutability.

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Bibliographic Info

Paper provided by Federal Reserve Bank of San Francisco in its series Working Paper Series with number 2004-13.

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Date of creation: 2004
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Handle: RePEc:fip:fedfwp:2004-13

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Keywords: Information technology ; Capital ; Productivity;

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Citations

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Cited by:
  1. Michelle Alexopoulos, 2004. "Read All About it: What happens following a technology shock," 2004 Meeting Papers 56, Society for Economic Dynamics.
  2. Raquel Ortega-Argilés & Mariacristina Piva & Marco Vivarelli, 2012. "The transatlantic productivity gap: Is R&D the main culprit?," DISCE - Quaderni del Dipartimento di Scienze Economiche e Sociali dises1284, Università Cattolica del Sacro Cuore, Dipartimenti e Istituti di Scienze Economiche (DISCE).
  3. Daniel Wilson, 2004. "Investment Behavior of U.S. Firms Over Heterogenous Capital Goods: A Snapshot," Working Papers 04-19, Center for Economic Studies, U.S. Census Bureau.
  4. repec:idb:brikps:61058 is not listed on IDEAS
  5. Catherine L. Mann, 2012. "Information Technology Intensity, Diffusion, and Job Creation," Working Papers 46, Brandeis University, Department of Economics and International Businesss School.
  6. B. Atrostic, 2008. "Measuring U.S. innovative activity: business data at the U.S. Census Bureau," The Journal of Technology Transfer, Springer, vol. 33(2), pages 153-171, April.
  7. Sadaf Bashir & Bert Sadowski, 2014. "General Purpose Technologies: A Survey, a Critique and Future Research Directions," Working Papers 14-02, Eindhoven Center for Innovation Studies, revised Feb 2014.
  8. Raquel Ortega-Argilés, 2012. "The Transatlantic Productivity Gap: A Survey Of The Main Causes," Journal of Economic Surveys, Wiley Blackwell, vol. 26(3), pages 395-419, 07.

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