The Impact of Public Capital, Human Capital, and Knowledge on Aggregate Output
Abstract
This paper investigates the impact of public capital on private sector output by testing and estimating an aggregate production function for the U.S. economy over the postwar period augmented to include the stock of public capital as an additional factor input. We use patent applications to proxy for knowledge/technology stocks and adjust labor hours for changes in human capital or skill. Using Johansen's (1988 and 1991) multivariate cointegration analysis, we find a positive and significant long run effect of public capital, private capital, skilladjusted labor, and technology/ knowledge on private sector output. We find that public capital accounts for about half of the post-1973 productivity slowdown, but only plays a minor role in the partial recovery of labor productivity growth since the mid 1980s. The largest contribution to that (partial) recovery comes from the knowledge stock and human capital.Download Info
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Paper provided by International Monetary Fund in its series IMF Working Papers with number 08/218.Length: 167
Date of creation: 01 Sep 2008
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Handle: RePEc:imf:imfwpa:08/218
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Related research
Keywords: Human capital; Economic growth; Public finance; Labor productivity; Economic models;This paper has been announced in the following NEP Reports:
- NEP-ALL-2008-10-28 (All new papers)
- NEP-HRM-2008-10-28 (Human Capital & Human Resource Management)
- NEP-KNM-2008-10-28 (Knowledge Management & Knowledge Economy)
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Citations
Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.Cited by:
- Alfredo Marvão Pereira & Jorge M. Andraz, 2011.
"On the economic effects of public infrastructure investment:A survey of the international evidence,"
Working Papers
108, Department of Economics, College of William and Mary.
- Alfredo Pereira & Jorge Andraz, 2012. "On the economic effects of public infrastructure investment: A survey of the international evidence," CEFAGE-UE Working Papers 2012_10, University of Evora, CEFAGE-UE (Portugal).
- Valter Di Giacinto & Giacinto Micucci & Pasqualino Montanaro, 2012. "The Macroeconomic Impact of Infrastructures: A Literature Review and Empirical Analysis on the Case of Italy," QA - Rivista dell'Associazione Rossi-Doria, Associazione Rossi Doria, issue 1, March.
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