NATIONAL BUREAU OF ECONOMIC RESEARCH
NATIONAL BUREAU OF ECONOMIC RESEARCH

Assessing Dynamic Efficiency: Theory and Evidence

Andrew B. Abel, N. Gregory Mankiw, Lawrence H. Summers, Richard J. Zeckhauser

NBER Working Paper No. 2097 (Also Reprint No. r1168)
Issued in December 1986
NBER Program(s):   EFG   PR

The issue of dynamic efficiency is central to analyses of capital accumulation and economic growth. Yet the question of what operating characteristics of an economy subject to productivity shocks should be examined to determine whether or not it is efficient has not been resolved. This paper develops criterion based on observables for determining whether or not an economy is dynamically efficient. The criterion involves a comparison of the cash flows generated by capital with the volume of investment. Its application to the United States economy and the economies of other major OECD nations suggests that they are dynamically efficient.

download in pdf format
   (316 K)

download in djvu format
   (223 K)

email paper

This paper is available as PDF (316 K) or DjVu (223 K) (Download viewer) or via email.

Machine-readable bibliographic record - MARC, RIS, BibTeX

Document Object Identifier (DOI): 10.3386/w2097

Published: Review of Economic Studies, Vol. 56, No. 1, pp. 1-20, (January 1989). citation courtesy of

Users who downloaded this paper also downloaded these:
Mankiw and Summers w1443 Are Tax Cuts Really Expansionary?
Blanchard and Weil w3992 Dynamic Efficiency, the Riskless Rate, and Debt Ponzi Games Under Uncertainty
Gorton and Metrick w15223 Securitized Banking and the Run on Repo
Elmendorf and Mankiw w6470 Government Debt
Kraay and Ventura The Dot-Com Bubble, the Bush Deficits, and the U.S. Current Account
 
Publications
Activities
Meetings
NBER Videos
Data
People
About

Support
National Bureau of Economic Research, 1050 Massachusetts Ave., Cambridge, MA 02138; 617-868-3900; email: info@nber.org

Contact Us