Jump to ContentJump to Main Navigation
Show Summary Details
More options …

The B.E. Journal of Macroeconomics

Editor-in-Chief: Cavalcanti, Tiago / Kambourov, Gueorgui

Ed. by Abraham, Arpad / Carceles-Poveda , Eva / Debortoli, Davide / Lambertini, Luisa / Nimark, Kristoffer / Wang, Pengfei

2 Issues per year

IMPACT FACTOR 2017: 0.378
5-year IMPACT FACTOR: 0.462

CiteScore 2017: 0.62

SCImago Journal Rank (SJR) 2017: 0.553
Source Normalized Impact per Paper (SNIP) 2017: 0.605

See all formats and pricing
More options …

Estimates of the Marginal Product of Capital, 1970-2000

Marcelo Mello
Published Online: 2009-05-06 | DOI: https://doi.org/10.2202/1935-1690.1723

We compute the marginal product of capital (MPK) taking into account cross-country differences in the relative price of capital in a large panel including 95 countries over the period 1970-2000. Estimates of the price-uncorrected MPK suggest that the marginal product of capital is much larger in poor countries than in rich countries throughout the entire sample period. However, estimates of the price-corrected MPK suggest that differences in the marginal product of capital between rich and poor countries were significant in the 1970's, decreased substantially in the 1980's, and were negligible in the 1990's. In fact, the correlation between price-corrected MPK and GDP per worker is close to zero for most of the 1990's. Furthermore, we find that in both rich and poor countries the capital-output ratio is increasing over time, and while the relative price of capital is slightly decreasing in rich countries it is strongly increasing in poor countries. Counterfactual reallocations of capital that equalize its rate of return around the world would have yielded significant output gains in poor countries in the 1970's, but gains in the 1990's would have been negligible. These findings are robust to alternative rich/poor cut-offs. Our results suggest that international capital markets are largely integrated since the early 1990's.

Keywords: MPK; relative price of capital; capital-output ratio

About the article

Published Online: 2009-05-06

Citation Information: The B.E. Journal of Macroeconomics, Volume 9, Issue 1, ISSN (Online) 1935-1690, DOI: https://doi.org/10.2202/1935-1690.1723.

Export Citation

©2011 Walter de Gruyter GmbH & Co. KG, Berlin/Boston.Get Permission

Citing Articles

Here you can find all Crossref-listed publications in which this article is cited. If you would like to receive automatic email messages as soon as this article is cited in other publications, simply activate the “Citation Alert” on the top of this page.

Alexei Izyumov and John Vahaly
Journal of Economic Studies, 2014, Volume 41, Number 5, Page 696
Nan-Ting Chou, Alexei Izyumov, and John Vahaly
Cambridge Journal of Economics, 2016, Volume 40, Number 4, Page 1149
Alexei Izyumov and John Vahaly
Review of Income and Wealth, 2015, Volume 61, Number 1, Page 179

Comments (0)

Please log in or register to comment.
Log in