Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/146770
Authors: 
Knoblach, Michael
Rößler, Martin
Zwerschke, Patrick
Year of Publication: 
2016
Series/Report no.: 
CEPIE Working Paper 03/16
Abstract: 
The elasticity of factor substitution between capital and labor is a crucial parameter in many economic fields. However, despite extensive research, there is no agreement on its value. Utilizing 738 estimates from 41 studies published between 1961 and 2016, this paper provides the first meta-regression analysis of capital-labor substitution elasticities for the U.S. economy. We show that heterogeneity in reported estimates is driven by the choice of estimation equations, the modeling of technological dynamics, and data characteristics. Based on the underlying meta-regression sample and a "best practice" specification, we estimate a long-run elasticity in the range of 0.6 to 0.7. For all estimated elasticities the hypothesis of a Cobb-Douglas production function is rejected.
Subjects: 
Elasticity of Factor Substitution
Capital
Labor
Cobb-Douglas
CES Production Function
Meta-Regression Analysis
Meta Regression
Meta Analyse
Substitutionselastizität
Cobb-Douglas
CES Produktionsfunktion
Arbeit
Kapital
JEL: 
E23
O30
O40
Persistent Identifier of the first edition: 
Document Type: 
Working Paper

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