Sloka3.

The number of Ghatikas that have passed in the

Rising Sign at birth when multiplied by 9 and divided by the
number indicating the Ghatikas etc., of the rising time of that
sign will show the length of years contributed by the Lagna.
The remainder will give the months, days, etc., when suitably
multiplied and divided by their appropriate factors. If the Lagna
is powerful being occupied or aspected by its lord or a benefic
planet or by its lord being in his exaltation, the number of years
contributed by the Lagna will correspond with the years signified
by the Rasis, etc., reckoned from Aries, in the figure denoting
the Lagna. This view is held by some great Astrologers.
Macroeconomics Issues
An increase in the quality of capital increases labor productivity (more output
for the same
amount of labor).We thus have our third answer as to why labor productivity has
increased over
time the quality of capital has increased because of embodied technical change.
We will come back to embodied technical change, but to finish the train of thoug
ht we turn
next to disembodied technical change.
Disembodied Technical Change
In some situations we can achieve higher levels of output over time even if the
quantity and quality
of labor and capital don't change. How might we do this? Perhaps we learn how to
better organize
the plant floor or manage the labor force. In recent years operational improveme
nts like lean manufacturing
and vendor inventory management systems have increased the ability of many manuf
acturing
firms to get more output from a fixed amount and quality of labor and capital. E
ven
improvements in information and accounting systems or incentive systems can lead
to improved
output levels. A type of technical change that is not specifically embedded in e
ither labor or capital
but works instead to allow us to get more out of both is called disembodied tech
nical change.
Recent experiences in the Chinese economy provide an interesting example of what
might be
considered disembodied technical change broadly defined. Working at the IMF, Zul
iu Hu and
Mohsin Khan have pointed to the large role of productivity gains in the 20 years
following the market
reforms in China. In the period after the reforms, productivity growth rates tri
pled, averaging
almost 4 percent a year. Hu and Khan argue that the productivity gains came prin
cipally from the
unleashing of profit incentives that came with opening business to the private s
ector. Better incentives
produced better use of labor and capital.
Disembodied technical change can be negative. An example is environmental regula
tions that
require the whole production process to pollute less and thus, say, run less eff
iciently from a private
perspective.Another example is health and safety regulations that require the pr
oduction process to
run slower to reduce injuries to workers. There is an important caveat here, how
ever. In these examples,
output will be smaller if it does not include the increased quality of air, wate

r, health, and safety

that results from the regulations. So you can think about disembodied technical
change in these
cases as being negative regarding the usual measure of output, but not necessari
ly a broader measure
of welfare.
To the extent that disembodied technical changes are mostly positive, this is ou
r fourth answer
as to why labor productivity has increased. People have figured out how to run p
roduction
processes and how to manage firms more efficiently.
More on Technical Change
We have seen that both embodied and disembodied technical change increase labor
productivity.
It is not always easy to decide whether a particular technical innovation is emb
odied or disembodied,
and in many discussions this distinction is not made. In the rest of this sectio
n we will not
make the distinction, but just talk in general about technical innovations. The
main point to keep
in mind is that technical change, regardless of how it is categorized, increases
labor productivity.
The Industrial Revolution was in part sparked by new technological developments.
New techniques
of spinning and weaving the invention of the machines known as the mule and the sp
inning
jenny, for example were critical. The high-tech boom that swept the United States
in the early 1980s
was driven by the rapid development and dissemination of semiconductor technolog
y. The hightech
boom in the 1990s was driven by the rise of the Internet and the technology asso
ciated with it. In
India in the 1960s, new high-yielding seeds helped to create a green revolution in
agriculture.
Technical change generally takes place in two stages. First, there is an advance
in knowledge, or an
invention.However, knowledge by itself does nothing unless it is used.When new k
nowledge is used
to produce a new product or to produce an existing product more efficiently, the
re is innovation.
Given the centrality of innovation to growth, it is interesting to look at what
has been happening
to research in the United States over time. A commonly used measure of inputs in
to research is
the fraction of GDP spent. In 2007, the United States spent 2.6 percent of it GD
P on R&D, down
from a high of 2.9 percent in the early 1960s.Moreover, over time, the balance o
f research funding
has shifted away from government toward industry. Since industry research tends
to be more
applied, some observers are concerned that the United States will lose some of i
ts edge in technology
unless more funding is provided. In 2007, the National Academies of Science argu
ed as follows:
Although many people assume that the United States will always be a world leader
in
science and technology, this may not continue to be the case inasmuch as great m
inds