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Research Article

Estimating the Capital Stock of China with Depreciation in IO Tables

Wang Jun and Shi Jihui

As a measure of production factor, capital (K), Capital stock is a key parameter in macroeconomic analysis and policy studies. However, how to account capital stock is a great dispute for the lack of essential data in China. A new method to evaluate the capital stock with optimized depreciation rate is proposed in this paper which makes the sum squared residual minimized between calculated value and authoritative depreciation data from Input-Output (IO) tables, with the capital stock of base year unknown. Formula of the optimized depreciation rate and the base year capital stock can be derived from rigid theory reasoning of the optimization problem to evaluate the capital stock of any year.

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  How to cite this article:

Wang Jun and Shi Jihui, 2013. Estimating the Capital Stock of China with Depreciation in IO Tables. Journal of Applied Sciences, 13: 1799-1804.

DOI: 10.3923/jas.2013.1799.1804


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