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  3. American Economic Journal: Macroeconomics
  4. April 2012
  5. How Important Is Technology Capital for the United States?

How Important Is Technology Capital for the United States?

  • Marek Kapička
American Economic Journal: Macroeconomics
vol. 4, no. 2, April 2012
(pp. 218-48)
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Abstract

I construct measures of technology capital and country openness for the US economy and the rest of the world for 1982-2007. The key identifying assumption is that firms equalize returns on tangible and technology capital. For the US economy, technology capital is about one-third of tangible capital, and the degree of openness is between 0.61 and 0.70. I provide both a two-country estimation and a multicountry estimation, and find that the US estimates are almost identical in both cases. The welfare loss from totally closing the US economy is small, but the welfare gain from totally opening the US economy is large. (JEL E22, F41, O30)

Citation

Kapička, Marek. 2012. "How Important Is Technology Capital for the United States?" American Economic Journal: Macroeconomics, 4 (2): 218-48. DOI: 10.1257/mac.4.2.218

Additional Materials

JEL Classification

  • E22 Capital; Investment; Capacity
  • F41 Open Economy Macroeconomics
  • O30 Technological Change; Research and Development; Intellectual Property Rights: General
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