TY  - JOUR
AU  - Acemoglu,Daron
TI  - Labor- and Capital- Augmenting Technical Change
JF  - National Bureau of Economic Research Working Paper Series
VL  - No. 7544
PY  - 2000
Y2  - February 2000
UR  - http://www.nber.org/papers/w7544
L1  - http://www.nber.org/papers/w7544.pdf
N1  - Author contact info:
Daron Acemoglu
Department of Economics
MIT, E52-380B
50 Memorial Drive
Cambridge, MA  02142-1347
Tel: 617/253-1927
Fax: 617/253-1330
E-Mail: daron@mit.edu
AB  - I analyze an economy in which profit-maximizing firms can undertake both labor- or capital-augmenting technological improvements.  In the long run, the economy looks like the standard growth model with purely labor-augmenting technical change, and the share of labor in GDP is constant.  Along the transition path, however, there is capital-augmenting technical change and factor shares change.  A range of policies may have counterintuitive implications due to their effect on the direction of technical change.  For example, taxes on capital income reduce the labor share in the short run, but increase it in the medium/long run.
ER  -