Abstract
This paper measures the gross stock of capital of cultivators and tractors in Japanese agriculture during the period from 1975 to 2000, with special focus on the quality changes. The physical stock value method is applied, taking the quality difference of the stock produced in various years into account. First, the physical stock is broken down by the year produced. Second, the quality adjustment index is calculated for each year. Third, the quality-adjusted physical stock is calculated by using the broken-down physical stock and the quality adjustment index. Last, the gross stock of capital is calculated as the product of the price and the quality-adjusted physical stock.
This paper also estimates the gross capital formation and the durable period. Conventional gross capital stock and gross capital formation, which leave quality changes out of consideration, are also measured.
The results of measurement show that the gross capital stock of cultivators and tractors in Japanese agriculture with quality changes has grown more rapidly than that of conventional estimation.
