[lbo-talk] National Accounts

tfast tfast at yorku.ca
Wed Dec 13 16:29:52 PST 2006


Rakesh,

What does it mean to say that the growth of capital stock is four times the rate in China compared to the US. If the US has a higher capital stock to begin with it will take a much higher absolute level of investment to move the relative rate of increase higher in the US than in China. Eg China with a capital stock of 10 would need an investment of 1 for a10 percent increase smilarily the US with a capital stock of 30 would need and increase 3 or three times the absolute investment in capital stock.

This is a question as I do not know what the absolute difference is in the amount of capital stock between the two countries. Whatever capital maybe:),


> Yet, Doug, if profits are easy then how do you explain the feeble
> capital accumulation in the North in recent years? Or do you deny
> that it has been feeble and that capital stock growth is likely to be
> near stagnant going forward?
>
> Prospect of profits from new investments has not encouraged a real
> spout of real capital accumulation, anemic compared to China's growth
> of capital stock rising 10% per year which as Andrew Glyn points out
> is four times the rate of Northern countries.



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