Contributions of capital stock improvement to economic growth : the case of Hong Kong

Jan Piaw, Thomas VOON, K. Y., Edward CHEN

Research output: Journal PublicationsJournal Article (refereed)peer-review

1 Citation (Scopus)

Abstract

This paper postulates that productivity change can take place in a developing country experiencing changes in the composition of its capital inputs. It develops a model for assessing this type of productivity change. Hong Kong is used as our case study. The aggregate capital stock productivity change has contributed on average to about 14% of the output growth in HK over 1966-1996. It represents about 20% of the aggregate TFP growth in HK over the period 1966-1986, rising to above 90% over 1986-1996. The aggregate TFP contribution to HK's output growth over 1991-1996 was attributed almost entirely to capital stock productivity change. Contribution of the disembodied component of the residual TFP growth to output growth has concomitantly declined to a negative level over the period under study. The paper points to the role of capital stock productivity improvement in sustaining HK's economic growth.
Original languageEnglish
Pages (from-to)631-644
Number of pages14
JournalJournal of Asian Economics
Volume14
Issue number4
DOIs
Publication statusPublished - 1 Aug 2003

Bibliographical note

The authors are also grateful to an anonymous referee and the Editor of this journal for their helpful comments.

Funding

The work described in this paper was fully supported by a grant from the Research Grants Council of the Hong Kong Special Administrative Region, China (Project No. LC3005/97H).

Keywords

  • Capital stock
  • Growth
  • Productivity change
  • Quality adjustment

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