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Year: 1997 Publisher: Cambridge, Mass. National Bureau of Economic Research
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Year: 1997 Publisher: Cambridge, Mass. National Bureau of Economic Research
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Machines are more expensive in poor countries, and the relation is pronounced. It is hard for a Solow (1956) type of model to explain the relation between machine prices and GDP given that in most countries equipment investment is under 10% of GDP. A stronger relation emerges in a Solow (1959) type of vintage model in which technology is embodied in machines.
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