4 3.5 Trillion U.S. Y = A0(t) F(AK(t)K, AH(t)H, AL(t)L) = A0F(AK(t)K, AHH, ALL) = A0F(AKK, AH(t)H, ALL) = A0F(A(t)K Why is There No Measured

4 3.5 Trillion U.S. Y = A0(t) F(AK(t)K, AH(t)H, AL(t)L) = A0F(AK(t)K, AHH, ALL) = A0F(AKK, AH(t)H, ALL) = A0F(A(t)K Why is There No Measured Technical Progress in East Asian NIEs? The effects of technical progress in these production function studies are essentially captured by the estimated parameters of the time trend, which is supposed to reflect the influence of the changes in the omitted or unmeasured inputs, such as human capital, R&D capital, R&D capital, knowledge capital, land or more generally the natural endowment of resources, and other intangible “investments” such as software and market development. Why is There No Measured Technical Progress in East Asian NIEs? Thus the indigenously generated improvements in technology have been quite scarce in developing East Asian economies other than Japan. By contrast, the industrialized economies invest a significant percentage of their GDP in R&D and even greater amounts in innovation and other productivity-enhancing activiti