capital labour ratio

capital labour ratio

the proportion of CAPITAL to LABOUR inputs in a company This can be measured by means of a number of accounting ratios. One measure is total assets per pound of employee remuneration: the higher the ratio (the more capital per pound of labour cost), the greater the degree of capital intensity. Alternatively, we could take FIXED ASSETS per employee, or more narrowly plant and machinery per employee, as an index of the degree of mechanization in a firm. Where a company employs a high proportion of part-time workers, numbers employed may need to be adjusted to full-time equivalent numbers to assist comparability. Alternatively, assets may be expressed as a proportion of total employee remuneration.
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Bidirectional causality between inflation and capital productivity through capital labour ratio is also found.
We choose as structural variables: 1) the number of main lines per 100 inhabitants, 2) the capital labour ratio and 3) the existence of market liberalization.
This implies that in order to increase the steady state level, authorities must not only care about the rates of technical change, capital labour ratio, number of main lines and the fact that a market is liberalized or not, but also with every tangible and intangible factor that may be related to individual effects.
In the same way, the existence of different technologies or input markets could be reflected in the evolution of the capital labour ratio.
As far as the other variables are concerned, capital labour ratio has a notable positive impact on TFP and it is significant for all the periods (see Table 7).
The absence of a homogeneous diffusion process in the new telecommunications services, affecting the capital labour ratio, could be one of the causes of the differences in productivity patterns among telecommunications industries.
Between 1988 and 1993 average growth in the capital labour ratio was higher in New Zealand than in Australia (see Figure 10), and labour productivity growth was also higher in New Zealand.
Table 4 Capital-output Ratio, Capital Labour Ratio, and Average Labour Productivity Output-employment Ratio Years Agriculture Manufactur- Construc- Electricity ing Mining tion and Gas 1964 897.