When should firms invest in old capital?

International Journal of Economic Theory

Volumn 5, Issue 1, 2009, Pages 107-123

  Jovanovic, Boyan ^a  

^a NEW YORK UNIVERSITY   (United States)

Author keywords

Complementarity; Obsolescence; Physical depreciation; Vintage capital

Indexed keywords

EID: 77957266899     PISSN: 17427355     EISSN: 17427363     Source Type: Journal    
DOI: 10.1111/j.1742-7363.2008.00096.x     Document Type: Article

References (29)

1. Adda, J., and R. Cooper (2000), "Balladurette and Juppette: A discrete analysis of scrapping subsidies," Journal of Political Economy 108, No. 4, 778-806.
2. Aruga, O. (2007), "Conventional or new? Optimal investment allocation across vintages of technology," Ministry of Education, Japan, November.
3. Benhabib, J., and A. Rustichini (1991), "Vintage capital, investment and growth," Journal of Economic Theory 55, 323-39.
4. Benhabib, J., and A. Rustichini (1993), "A vintage model of growth and investment: Theory and evidence," R. Becker, M. Boldrin, R. Jones, and W. Thomson, eds, General Equilibrium, Growth and Trade II, 248-300, San Diego: Academic Press.
5. Boddy, R., and M. Gort (1971), "The substitution of capital for capital," Review of Economics and Statistics 53, No. 2, 179-88.
6. Boldrin, M., and D. K. Levine (2001), "Growth cycles and market crashes," Journal of Economic Theory 96, 13-39.
7. Boldrin, M., and D. K. Levine (2002), "Factor saving innovation," Journal of Economic Theory 105, 18-41.
8. Boldrin, M., and J. Fernandez-Villaverde (2005), "A theory of growth cycles," November, unpublished.
9. Chari, V. V., and H. Hopenhayn (1991), "Vintage human capital," Journal of Political Economy 99, 1142-65.
10. Comin, D., and B. Hobijn (2004), "Cross-country technology adoption: Making the theories face the facts," Journal of Monetary Economics 51, 39-83.
11. Comin, D., and B. Hobijn (2006), "An exploration of technology diffusion," National Bureau of Economic Research Working Paper No. 12314, National Bureau of Economic Research, Cambridge, MA.
12. Cooper, R., and J. Haltiwanger (1993), "The aggregate implications of machine replacement: Theory and evidence," American Economic Review 83, 360-82.
13. Domar, E. (1963), "Total productivity and the quality of capital," Journal of Political Economy 71, 586-88.
14. Gort, M., J. Greenwood, and P. Rupert (2003), "Measuring the rate of technological progress in structures," Review of Economic Dynamics 2, 207-30.
15. Greenwood J., Z. Hercowitz, and P. Krusell (1997), "Long-run implications of investment-specific technological change," American Economic Review 87, 342-362. The October 1992 version is at https://urresearch.rochester.edu/retrieve/5493/GHK1992.pdf
16. Hulten, C., and F. Wykoff (1981), "The estimation of economic depreciation using vintage asset prices: An application of the Box-Cox power transformation," Journal of Econometrics 15, 367-96.
17. Jeong, H., and Y. Kim (2007), "Complementarity and transition to modern economic growth," mimeo, USC, Los Angeles, CA.
18. Jeong, H., Y. Kim, and I. Manovskii (2007), "Demographic change and relative wages," mimeo, USC, Los Angeles, CA.
19. Jorgenson D. (1966), "The embodiment hypothesis," Journal of Political Economy 74, 1-17.
20. Jovanovic, B. (1998), "Vintage capital and inequality," Review of Economic Dynamics 1, 497-530.
21. Jovanovic, B., and Y. Nyarko (1996), "Learning by doing and the choice of technology," Econometrica 64, 1299-310.
22. Jovanovic, B., and P. L. Rousseau (2008) "Mergers as reallocation," Review of Economics and Statistics 90, 765-76.
23. Katz, L., and K. Murphy (1992), "Changes in relative wages, 1963-1987: Supply and Demand Factors," Quarterly Journal of Economics 107, 35-78.
24. Koeniger, W., and O. Licandro (2006), "On the use of substitutability as a measure of competition," Topics in Macroeconomics. Berkeley Electronic Press 6, 1283-3.
25. Kredler, M. (2007), "Experience vs. obsolescence: A vintage-human-capital model," New York University, New York, October.
26. Kremer, M., and J. Thomson (1998), "Why isn't convergence instantaneous? Young workers, old workers, and gradual adjustment," Journal of Economic Growth 3, 5-23.
27. Krusell, P., L. Ohanian, V. Rios-Rull, and G. Violante (2000), "Capital-skill complementarity and inequality: A macroeconomic analysis," Econometrica 68, 1029-53.
28. Licandro, O., L. Puch, and A. Sampayo (2006), "Secondhand market and the lifetime of durable goods," Working Paper No. 2006-10, FEDEA, March Fundación de Estudios de Economía Aplicada, Madrid.
29. Stolyarov, D. (2002), "Turnover of used goods in stationary equilibrium: Are older goods traded more?" Journal of Political Economy 110, 1390-413.