Journal of Political Economy Vol. 88 No. 3 1980
Relative Capital Formation in the United States
Abstract
A version of the overlapping-generations model suggests that an increase in the rate of innovation alters capital formation in favor of schooling and other human capital at the expense of physical capital, and tends to reduce total savings, defined as human investments plus financial savings. The theoretical explanation suggests that relative capital formation in human beings, but not necessarily absolute capital formation, is positively associated with the degree of innovation. Analysis of U.S. time-series data supports the hypotheses advanced in the paper.
- Volume
- 88
- Issue
- 3
- Pages
- 561-577
- Sources
- bibtex:phds-export.bib