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- Title
The Relationship between Investment and Spare Capacity in the United Kingdom, 1957-66.
- Authors
Junankar, P. N.
- Abstract
This article looks into the relationship between investment and spare capacity in Great Britain from 1957-1966. The Paish hypothesis has put forward contradictory versions of the hypothesis wherein: (1) the level of spare capacity does not affect investment; and (2) there is some optimal level of spare capacity at which investment is maximized. The use of the adaptive expectations and partial adjustment models were used to present a distributed-lag accelerator and mathematical statistics were used to develop a modified capital-stock adjustment and spare capacity model. It is implied that to stimulate investment and through it growth, the economy should be run within the full capacity zone.
- Subjects
INVESTMENTS; INDUSTRIAL capacity; ECONOMIC models; MATHEMATICAL models; ECONOMETRICS; ECONOMIC statistics; ECONOMIC conditions in Great Britain -- 1945-1964
- Publication
Economica, 1970, Vol 37, Issue 147, p277
- ISSN
0013-0427
- Publication type
Article
- DOI
10.2307/2551974