Michael Perelman wrote: > > The government now regards software as capital & ketchup as a vegetable.
Doug > The second is ridiculous - and about 25 years out of date - but the first? > Why is software not capital? A computer is. What's a computer without > software? Would firmware be capital because it's software embedded in > hardware but not pure software? I don't get why these two things are equally > silly. the main problem with seeing software as a type of capital good -- and this applies to hardware, too, though to a lesser extent -- is that software depreciates very quickly. Dean Baker argues that because of the growing importance of computer hardware and software in the US economy, the over-all depreciation rate is higher. Most measures of "economic growth" use real Gross Domestic Product. With faster depreciation, real Net Domestic Product is falling behind real GDP. It's NDP that really counts as an increase in market production and income, so real growth of the market economy has been slower than advertised. The only reason why macroeconomists don't use NDP is because depreciation is so hard to measure accurately. Jim Devine _______________________________________________ pen-l mailing list [email protected] https://lists.csuchico.edu/mailman/listinfo/pen-l
