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Technical Progress in U.S. Manufacturing Sectors, 1948-1973: An Application of Lie Groups

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  • Ryuzo Sato
  • Thomas M. Mitchell

Abstract

The purpose of this paper is to apply the theory of Lie transformation groups as developed by the first author, and derive a testable model of production and technical change. The econometric model is then applied to data derived by F. Gollop and D. Jorgenson for U.S. manufacturing industries for the years 1948-1973. This is the first empirical work in economics to incorporate the theory of Lie transformation groups, so the results are new, but they are also interesting. Using Zellner's seemingly unrelated regression equations method of generalized least squares produces an estimate of a model for the 21-industry system which has a high degree of explanatory power: The system's weighted-R2 is 0.9675 and all coefficients are statistically significant at the 5% level (on the basis of t-tests). While the "form" of technical change in a given industry of the model is probably new, it is easily characterized within the Lie group structure and the system estimate is statistically significant.

Suggested Citation

  • Ryuzo Sato & Thomas M. Mitchell, 1985. "Technical Progress in U.S. Manufacturing Sectors, 1948-1973: An Application of Lie Groups," NBER Technical Working Papers 0047, National Bureau of Economic Research, Inc.
    • Handle: RePEc:nbr:nberte:0047
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    References listed on IDEAS

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    1. R. Sato & M. J. Beckmann, 1968. "Neutral Inventions and Production Functions," The Review of Economic Studies, Review of Economic Studies Ltd, vol. 35(1), pages 1-2.
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    3. Sveikauskas, Leo, 1981. "Technological Inputs and Multifactor Productivity Growth," The Review of Economics and Statistics, MIT Press, vol. 63(2), pages 275-282, May.
    4. The Conference on Research in Income and Wealth, 1961. "Output, Input, and Productivity Measurement," NBER Books, National Bureau of Economic Research, Inc, number unkn61-1.
    5. George J. Stigler, 1961. "Economic Problems in Measuring Changes in Productivity," NBER Chapters, in: Output, Input, and Productivity Measurement, pages 47-78, National Bureau of Economic Research, Inc.
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