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Investment Rates and the Aggregate Production Function


  • Fernando Garcıa-Belengue

    (Universidad Autonoma de Madri)

  • Manuel S. Santos

    () (Department of Economics, University of Miami)


In this paper we consider a simple version of the neoclassical growth model, and carry out an empirical analysis of the main determinants of aggregate investment across countries. More specifically, we study the effects on aggregate investment of income growth, capital income shares, the relative price of capital, and various market distortions. This exercise also sheds light into the shape of the neoclassical production function. We check these investment patterns for both OECD and non-OECD countries. We also decompose investment data into equipment and structures, and explore major factors affecting their relative prices

Suggested Citation

  • Fernando Garcıa-Belengue & Manuel S. Santos, 2011. "Investment Rates and the Aggregate Production Function," Working Papers 2011-3, University of Miami, Department of Economics.
  • Handle: RePEc:mia:wpaper:2011-3

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    References listed on IDEAS

    1. Garcia-Belenguer, Fernando, 2007. "Stability, global dynamics and Markov equilibrium in models of endogenous economic growth," Journal of Economic Theory, Elsevier, vol. 136(1), pages 392-416, September.
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    More about this item


    Investment rates; Aggregate production function; Relative price of investment;

    JEL classification:

    • O41 - Economic Development, Innovation, Technological Change, and Growth - - Economic Growth and Aggregate Productivity - - - One, Two, and Multisector Growth Models
    • O47 - Economic Development, Innovation, Technological Change, and Growth - - Economic Growth and Aggregate Productivity - - - Empirical Studies of Economic Growth; Aggregate Productivity; Cross-Country Output Convergence

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