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Changing Technology Trends, Transition Dynamics, and Growth Accounting

  • Pakko Michael R.

    ()

    (Federal Reserve Bank of Saint Louis)

The technology growth trends that underlie recent productivity patterns are investigated in a framework that incorporates investment-specific technological progress. Structural-break tests and regime-shifting models reveal the presence of a downward shift in total factor productivity growth in the late 1960s and an upward shift in investment-specific technology growth in the mid-1980s. In both cases, these breaks precede the generally recognized dates of labor productivity growth shifts. Simulations of technology growth shocks in a basic neoclassical model show that induced patterns of capital accumulation are generally consistent with the observed lags between technological advances and changes in productivity growth.

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Article provided by De Gruyter in its journal The B.E. Journal of Macroeconomics.

Volume (Year): 5 (2005)
Issue (Month): 1 (December)
Pages: 1-42

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Handle: RePEc:bpj:bejmac:v:contributions.5:y:2005:i:1:n:12
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