Long-Run Implications of Investment-Specific Technological Change

Jeremy Greenwood*, Zvi Hercowitz, Per Krusell

*Corresponding author for this work

Research output: Contribution to journalArticlepeer-review


The role that investment-specific technological change played in generating post-war U.S. growth is investigated here. The premise is that the introduction of new more efficient capital goods is an important source of productivity change and an attempt is made to disentangle its effects from the more traditional Hicks-neutral form of technological progress. The balanced growth path for the model is characterized and calibrated to U.S. National Income and Product Account (NIPA) data. The quantitative analysis suggests that investment-specific technological change accounts for the major part of growth.

Original languageEnglish
Pages (from-to)342-362
Number of pages21
JournalAmerican Economic Review
Issue number3
StatePublished - Jun 1997


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