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| Author: | Dumenil, G. Levy, D. |
| Title: | Post depression trends in the economic rate of return for U.S. manufacturing |
| Journal: | Review of Economics and Statistics
1990 : AUG, VOL. 72:3, p. 406-413 |
| Index terms: | RATE OF RETURN MANUFACTURING INDUSTRY USA PROFITABILITY DEPRECIATION |
| Language: | eng |
| Abstract: | The objections made by Fisher and McGowan to the traditional accounting measure of the rate of profit apply to the downward trend in profitability that has been observed in USA manufacturing since the mid-sixties are analyzed. An estimate of the economic rate of return on investment is provided and compared with an estimate of the economic rate of return on the stock of capital with economic depreciation in the sense suggested by Hotelling. These two rates display a similar downward trend. Moreover, it can be shown that the movement of the economic rate of return on the stock of capital with economic depreciation is very close to that of the accounting rate of return with linear depreciation. |
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