Efficiency in the provision of public and private capital in 15 OECD countries
In this paper we use a sample of 15 OECD countries to examine whether provision of public and private capital satisfies conditions of intertemporal efficiency over the 1970-1995 period. We find robust evidence that private and public capital have followed criteria of efficient resource allocation in all countries. The estimated output elasticities of private and public capital display little variation across countries, and reach mean values of 0.19 and 0.055. Consequently, average rates of return to both factors are estimated at about 5-5.5%. All along we estimate a positive and significant intertemporal elasticity of substitution of consumption in all countries.
Volume (Year): 30 (2006)
Issue (Month): 2 (May)
|Contact details of provider:|| Postal: Investigaciones Economicas Fundación SEPI Quintana, 2 (planta 3) 28008 Madrid Spain|
Web page: http://www.fundacionsepi.es/
|Order Information:|| Web: http://www.fundacionsepi.es/revistas/presentacion.asp Email: |
References listed on IDEAS
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.:
- Campbell, John Y. & Mankiw, N. Gregory, 1991. "The response of consumption to income : A cross-country investigation," European Economic Review, Elsevier, vol. 35(4), pages 723-756, May.
- Hall, Robert E, 1988.
"Intertemporal Substitution in Consumption,"
Journal of Political Economy,
University of Chicago Press, vol. 96(2), pages 339-57, April.
- Ziliak, James P., 1998. "Does the choice of consumption measure matter? An application to the permanent-income hypothesis," Journal of Monetary Economics, Elsevier, vol. 41(1), pages 201-216, February.
- Holtz-Eakin, Douglas, 1994. "Public-Sector Capital and the Productivity Puzzle," The Review of Economics and Statistics, MIT Press, vol. 76(1), pages 12-21, February.
- Reinhart, Carmen & Ogaki, Masao, 1998.
"Intertemporal substitution and durable goods: long-run data,"
13683, University Library of Munich, Germany.
- Ogaki, Masao & Reinhart, Carmen M., 1998. "Intertemporal substitution and durable goods: long-run data," Economics Letters, Elsevier, vol. 61(1), pages 85-90, October.
- Epstein, Larry G & Zin, Stanley E, 1991. "Substitution, Risk Aversion, and the Temporal Behavior of Consumption and Asset Returns: An Empirical Analysis," Journal of Political Economy, University of Chicago Press, vol. 99(2), pages 263-86, April.
- Cogley, Timothy, 2002.
"Idiosyncratic risk and the equity premium: evidence from the consumer expenditure survey,"
Journal of Monetary Economics,
Elsevier, vol. 49(2), pages 309-334, March.
- Timothy Cogley, 1998. "Idiosyncratic risk and the equity premium: evidence from the Consumer Expenditure Survey," Working Papers in Applied Economic Theory 98-07, Federal Reserve Bank of San Francisco.
- Hansen, Lars Peter, 1982. "Large Sample Properties of Generalized Method of Moments Estimators," Econometrica, Econometric Society, vol. 50(4), pages 1029-54, July.
- Chapman, David A., 1997. "The cyclical properties of consumption growth and the real term structure," Journal of Monetary Economics, Elsevier, vol. 39(2), pages 145-172, July.
- Catherine J. Morrison & Amy Ellen Schwartz, 1992.
"State Infrastructure and Productive Performance,"
NBER Working Papers
3981, National Bureau of Economic Research, Inc.
- Cochrane, John H, 1991. " Production-Based Asset Pricing and the Link between Stock Returns and Economic Fluctuations," Journal of Finance, American Finance Association, vol. 46(1), pages 209-37, March.
- Attanasio, Orazio P & Weber, Guglielmo, 1989. "Intertemporal Substitution, Risk Aversion and the Euler Equation for Consumption," Economic Journal, Royal Economic Society, vol. 99(395), pages 59-73, Supplemen.
- Lawrence J. Christiano & Martin Eichenbaum & David Marshall, 1987.
"The Permanent Income Hypothesis Revisited,"
NBER Working Papers
2209, National Bureau of Economic Research, Inc.
- Shea, John, 1995. "Union Contracts and the Life-Cycle/Permanent-Income Hypothesis," American Economic Review, American Economic Association, vol. 85(1), pages 186-200, March.
- Gramlich, Edward M, 1994. "Infrastructure Investment: A Review Essay," Journal of Economic Literature, American Economic Association, vol. 32(3), pages 1176-96, September.
- Mary G. Finn, 1993. "Is all government capital productive?," Economic Quarterly, Federal Reserve Bank of Richmond, issue Fall, pages 53-80.
- Elena Márquez de la Cruz, 2005. "La elasticidad de sustitución intertemporal y el consumo duradero: un análisis para el caso español," Investigaciones Economicas, Fundación SEPI, vol. 29(3), pages 455-481, September.
- Otta, G.D. & Voss, G.M., 1996.
"Is Public capital Provision Efficient?,"
96/10, New South Wales - School of Economics.
- David Alan Aschauer, 1989. "Public investment and productivity growth in the Group of Seven," Economic Perspectives, Federal Reserve Bank of Chicago, issue Sep, pages 17-25.
- Hall, Robert E, 1978. "Stochastic Implications of the Life Cycle-Permanent Income Hypothesis: Theory and Evidence," Journal of Political Economy, University of Chicago Press, vol. 86(6), pages 971-87, December.
- Jose E. Bosca & Antonio Cutanda & Javier Escriba, 2004. "Rates of return to public and private capital: new estimates using nonlinear Euler equations," Applied Economics, Taylor & Francis Journals, vol. 36(11), pages 1225-1232.
- Berndt, Ernst R & Hansson, Bengt, 1992. " Measuring the Contribution of Public Infrastructure Capital in Sweden," Scandinavian Journal of Economics, Wiley Blackwell, vol. 94(0), pages S151-68, Supplemen.
- Otrok, Christopher & Ravikumar, B. & Whiteman, Charles H., 2002.
"Habit formation: a resolution of the equity premium puzzle?,"
Journal of Monetary Economics,
Elsevier, vol. 49(6), pages 1261-1288, September.
- Otrok, C. & Ravikumar, B. & Whiteman, C., 1998. "Habit Formation: A Resolution of the Equity Premium Puzzle?," Working Papers 98-04, University of Iowa, Department of Economics.
When requesting a correction, please mention this item's handle: RePEc:iec:inveco:v:30:y:2006:i:2:p:207-237. See general information about how to correct material in RePEc.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Isabel Sánchez-Seco)
If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.
If references are entirely missing, you can add them using this form.
If the full references list an item that is present in RePEc, but the system did not link to it, you can help with this form.
If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your profile, as there may be some citations waiting for confirmation.
Please note that corrections may take a couple of weeks to filter through the various RePEc services.