Measuring Capital Services by Energy Use: An Empirical Comparative Study
AbstractFrom an engineering perspective, a capital good’s service is energy conversion – e.g., the physical ‘work’ done by a machine – and can thus be measured directly by the energy consumed in production. We show important empirical advantages of our concept over traditional measures. The empirical application reveals that our concept avoids a number of conceptual problems of the latter. Furthermore, our measure is more sensitive to fluctuations in economic activity and therefore captures the utilization of the capital stock better. In a growth accounting exercise, this results in higher TFP growth rates, especially in times of global recession.
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Bibliographic InfoPaper provided by University of Oldenburg, Department of Economics in its series Working Papers with number V-351-13.
Length: 33 pages
Date of creation: Apr 2013
Date of revision: Apr 2013
Publication status: Published in Oldenburg Working Papers V-351-13
capital service; utilization; energy consumption; total factor productivity; growth accounting;
Find related papers by JEL classification:
- E22 - Macroeconomics and Monetary Economics - - Macroeconomics: Consumption, Saving, Production, Employment, and Investment - - - Capital; Investment; Capacity
- D24 - Microeconomics - - Production and Organizations - - - Production; Cost; Capital; Capital, Total Factor, and Multifactor Productivity; Capacity
- O47 - Economic Development, Technological Change, and Growth - - Economic Growth and Aggregate Productivity - - - Measurement of Economic Growth; Aggregate Productivity; Cross-Country Output Convergence
This paper has been announced in the following NEP Reports:
- NEP-ALL-2013-06-09 (All new papers)
- NEP-EFF-2013-06-09 (Efficiency & Productivity)
- NEP-ENE-2013-06-09 (Energy Economics)
- NEP-MAC-2013-06-09 (Macroeconomics)
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
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