Appraisal of the Labour-Saving and Capital-Saving Character of Innovations

Specific observations on the difficulties of measuring the stock of capital will be made later in this paper. At the outset I will say merely this: the analysis assumes that the quantity of capital is measured by some method which enables us to distinguish between changes in this quantity and changes in the productivity of capital. The analysis assumes also that the nature of the technological processes exerts an influence on distributive shares, in other words that these shares are not uniquely determined by administrative decisions. Both these assumptions are implicit in the marginal productivity theory, but they are implicit also in other ways of looking at capital and at the determination of distributive shares.