elasticity of substitution of capital for labor is apparently greater than one. This is perhaps the most important lesson of this study thus far: modern technology still uses a great deal of capital, and even more important, because capital has many uses, one can accumulate enormous amounts of it without reducing its return to zero. Under these conditions, there is no reason why capital’s share must decrease over the very long run, even if technology changes in a way that is relatively favorable to labor.
