What to make of the Kaldor-Verdoorn law?
نویسندگان
چکیده
Abstract The Kaldor-Verdoorn law refers to a positive but less than one-for-one causal relationship between the growth rates of output and labour productivity. While empirical research has found that coefficient lies 0 1, interpretation this finding remains unclear. In paper, we present model derive law. Our results show is jointly determined by elasticity factor substitution, supply elasticity, profit share increasing returns scale (or demand-induced technical change) parameter. Hence, estimated coefficients cannot be used, on their own, infer presence aggregate scale—with exception benchmark case Leontief Production technology (and steady-state analysis coupled with assumption Cobb-Douglas production technology). We also report surprising result: an economy without any progress) can generate 1.
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ژورنال
عنوان ژورنال: Cambridge Journal of Economics
سال: 2021
ISSN: ['1464-3545', '0309-166X']
DOI: https://doi.org/10.1093/cje/beab027