Among other things in OPE-L 5327, I wrote:
>2. For me, it is unclear why the "echo effects will become relatively
>smaller and smaller over time" if investment as a proportion of capital
>remains constant or increases over time. My crude examination of the
>data in the back of Dumenil and Levy tells me that the proportion is
>more or less constant over time.
In OPE-L 5335, Duncan commented:
The proportion of investment is roughly constant over time, but the whole
economy grows, so the proportion of investment represented by replacement
of capital n years back constantly shrinks.
I now add:
If the proportion of investment is constant over time, why isn't the
proportion earmarked for replacement "roughly" constant over time?
That is, while I agree there is growth and investment, I'm unclear
about why there would be a diminishing proportion of gross investment
designated for replacement.
John