TY  - JOUR
AU  - Long,J. Bradford De
AU  - Summers,Lawrence H.
TI  - Equipment Investment and Economic Growth
JF  - National Bureau of Economic Research Working Paper Series
VL  - No. 3515
PY  - 1990
Y2  - November 1990
UR  - http://www.nber.org/papers/w3515
L1  - http://www.nber.org/papers/w3515.pdf
N1  - Author contact info:
J. Bradford DeLong
Department of Economics
601 Evans Hall
University of California, Berkeley
Berkeley, CA 94720-3880
Tel: 510/643-4027
Fax: 510/642-6615
E-Mail: delong@econ.berkeley.edu

Lawrence H. Summers
Harvard Kennedy School of Government
79 JFK Street
Cambridge, MA 02138
Tel: 617/495-9322
Fax: 617/495-0436
E-Mail: lhs@harvard.edu
M2  - featured in NBER digest on 1991-02-01
AB  - Using data from the United Nations Comparison Project and the Penn World Table, we find that machinery and equipment investment has a strong association with growth: over l9&)?l95 each percent of GDP invested in equipment is associated with an increase in GDP growth of 1/3 a percentage point per year. This is a much stronger association than found between growth and any of the other components of investment. A variety of considerations suggest that this association is causal, that higher equipment investment drives faster growth, and that the social return to equipment investment in well functioning market economies is on the order of 30 percent per year.
ER  -