Capital intensity
In economics (especially in national accounts ), capital intensity is an economic indicator that shows the ratio of the capital stock required for the entire production of goods ( fixed assets ) to the number of employees required for this, i.e. the capital employed per employee:
The capital stock is price-adjusted, i.e. the value of the fixed assets is calculated by keeping the prices of a certain base year constant. The Federal Statistical Office carries out the price adjustment with the help of the prices of a certain base year for the fixed assets. The aggregates of the gross domestic product are now price-adjusted with the help of chain price indices.
Capital intensity usually rises with productivity, since technical progress or better production technology and the associated reduction in jobs means that more of the production factor capital is available per employed person, and more capital is used per worker. At the same time, higher capital intensity, i.e. increased use of means of production per employed person, also results in higher labor productivity .
For the economist Nicholas Kaldor , capital intensity is also the determinant of labor productivity. In its technical progress function , the growth rate of labor productivity is a function of the growth rate of capital intensity.