Okun's Law is an empirical observation that is partly tautological. It is "lawful" to the extent that it is tautological and "breaks down" to the extent that it isn't. Go figure.
On Wed, Jul 31, 2013 at 10:12 AM, Jim Devine <[email protected]> wrote: > Shane Mage <[email protected]> wrote: > > Adding internal corporate "R&D" to capital formation means including > > tax-deductible expense (not production) in GDP even though none of it is > > sold through the market, and adding those expenses to the profits and > > capital stock. > > As I understand it, the costs of the labor-power hired to do R&D end > up being counted as part of GDP: likely the market-value of the GDP > resulting from R&D labor would be counted by adding up their wages & > salaries, just as with the services provided by the government. > > Anyway, if the new measure of GDP leads to Okun's "Law" breaking down > completely, then that's a sign that the measure is poor. > -- > Jim Devine / "Reality is that which, when you stop believing in it, > doesn't go away." -- Philip K. Dick > _______________________________________________ > pen-l mailing list > [email protected] > https://lists.csuchico.edu/mailman/listinfo/pen-l > -- Cheers, Tom Walker (Sandwichman)
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