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Vintage Depreciation, User Costs, and Total Factor Productivity : Theory and Identification for Real Estate Capital

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  • SHIMIZU, Chihiro

Abstract

We develop a vintage-accounts framework for real estate capital measurement . The Mutual Determination Lemma, formalises the equivalence among vintage prices, user costs, and depreciation rates a constraint routinely violated in applied work. The MaintenanceDepreciation Theorem shows that linearly increasing maintenance costs produce a strictly accelerating depreciation profile, rationalising geometric-type patterns. The Geometric PIM Decomposition Theorem proves that geometrically distributed retirement ages are necessary and sufficient for a geometric population PIM, establishing Diewert (2004) 's δ * =

Suggested Citation

  • SHIMIZU, Chihiro, 2026. "Vintage Depreciation, User Costs, and Total Factor Productivity : Theory and Identification for Real Estate Capital," RCESR Discussion Paper Series DP26-9, Research Center for Economic and Social Risks, Institute of Economic Research, Hitotsubashi University.
    • Handle: RePEc:hit:rcesrs:dp26-9
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    References listed on IDEAS

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    1. Diewert, W. Erwin & Shimizu, Chihiro, 2016. "Hedonic regression models for Tokyo condominium sales," Regional Science and Urban Economics, Elsevier, vol. 60(C), pages 300-315.
    2. W. Erwin Diewert & Kevin J. Fox & Chihiro Shimizu, 2016. "Commercial Property Price Indexes And The System Of National Accounts," Journal of Economic Surveys, Wiley Blackwell, vol. 30(5), pages 913-943, December.
    3. Dale W. Jorgenson & J. Steven Landefeld & Paul Schreyer, 2014. "Measuring Economic Sustainability and Progress," NBER Books, National Bureau of Economic Research, Inc, number jorg12-1, January.
    4. Erwin Diewert & Chihiro Shimizu, 2017. "Alternative Approaches to Commercial Property Price Indexes for Tokyo," Review of Income and Wealth, International Association for Research in Income and Wealth, vol. 63(3), pages 492-519, September.
    5. Dale W. Jorgenson & J. Steven Landefeld & Paul Schreyer, 2014. "Introduction to "Measuring Economic Sustainability and Progress"," NBER Chapters, in: Measuring Economic Sustainability and Progress, pages 1-16, National Bureau of Economic Research, Inc.
    6. W. Erwin Diewert & Koji Nomura & Chihiro Shimizu, 2024. "Improving the SNA: Alternative measures of output, input, income, and productivity," Review of Income and Wealth, International Association for Research in Income and Wealth, vol. 70(4), pages 1142-1189, December.
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    Keywords

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    JEL classification:

    • C43 - Mathematical and Quantitative Methods - - Econometric and Statistical Methods: Special Topics - - - Index Numbers and Aggregation
    • D24 - Microeconomics - - Production and Organizations - - - Production; Cost; Capital; Capital, Total Factor, and Multifactor Productivity; Capacity
    • D92 - Microeconomics - - Micro-Based Behavioral Economics - - - Intertemporal Firm Choice, Investment, Capacity, and Financing
    • E22 - Macroeconomics and Monetary Economics - - Consumption, Saving, Production, Employment, and Investment - - - Investment; Capital; Intangible Capital; Capacity
    • R33 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Real Estate Markets, Spatial Production Analysis, and Firm Location - - - Nonagricultural and Nonresidential Real Estate Markets

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