; ; ; "ActiveFedora::Aggregation::ListSource" . a , ; "A Defense of AK Growth Models"; ; "jannelle.ruswick@mpls.frb.org"; "McGrattan, Ellen R."; "Federal Reserve Bank of Minneapolis"; "AK growth models predict that permanent changes in government policies affecting investment rates should lead to permanent changes in a country’s GDP growth. Charles Jones (1995) sees no evidence for this prediction in data for 15 OECD countries after World War II: rates of investment, especially for equipment, have risen while GDP growth rates have not. This article provides evidence supporting the AK models’ prediction. Data back to the 19th century show a strong positive relationship between investment rates and growth rates and short-lived deviations from trends. A strong positive relationship also exists between average rates of investment and growth in postwar data for a large cross-section of countries. To account for the short-run deviations in rates that Jones highlights, the model he used is extended to allow policies to affect not only investment/output ratios but also capital/output ratios and labor/leisure decisions."^^; "1998 Fall"; "2019-12-12T16:23:47.847844887+00:00"^^; "https://doi.org/10.21034/qr.2242"; ; "Mon Dec 16 17:35:54 2019"; "Article"; "508"; "Quarterly review (Federal Reserve Bank of Minneapolis. Research Department)"; "Vol. 22, No. 4"; ; ; ; ; "Federal Reserve Bank of Minneapolis. Research Department"; "[Additional files](https://researchdatabase.minneapolisfed.org/downloads/sb397830m) and [M-files and Ftools](https://researchdatabase.minneapolisfed.org/downloads/4x51hj04n)"^^; ; "Publication" . ; .