SEMAINE D ETUDE SUR LE ROLE DE L’ANALYSE ECONOMETRIQUE ETC. 859

[t is quite easy to make a direct estimate of a reasonable
order of magnitude. From $ 333, the value of equipment and
structures (in $ billion) is

C,=(1-%) C=1100.7 - 122.3=1077.4

The annual amortisation of this capital is

a, =1-(1- dC
nes

I-(x1-%) pC

.e. from the estimate derived earlier

A, =121.8 - 0.9 x 0.017 x 1077.4
=121.3 - 16.5 =105.3

Thus, a first approximation to the length of the amortisation
yeriod for investments is derived as

®,=1077.4/105.3=10.23

of the function (60) i.e. the invariance over time of the composition of
the labor force. Thus, for the U.S.A. in 1956, we should have

4.56
T—0.0085 x 4.56 = 4.74 -

Thus there are structural reasons for the average amortisation period for the
whole range of primary inputs to remain relatively low.
() It will be recalled that for fairly low values of p and i—p, the
1verage amortisation period of an element of capital is approximately equal
to the ratio of its value to the annual amount of amortisation, whatever
the amortisation schedule

‘11] Allais - pag. 163