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Appendix 1

Appendix Table 1: Results using relative prices unadjusted for sole-proprietors income, with the sample period from 1978-2002
Dependent variable: ln (K/L)	Australia		New Zealand
Dependent variable: ln (K/L)	Coefficient Estimate	t-ratio	Coefficient Estimate	t-ratio
Log of relative prices (β₁)	0.18***	3.59	0.15**	2.57
Time Trend (β₂)	0.005**	2.26	0.005***	3.64
Log of lagged capital-labour ratio (β₃)	0.62***	4.34	0.64***	5.02
Long-run elasticity of substitution	0.47***	-14.75^a	0.42***	-14.58^a
Adjusted R-squared	0.98		0.90
Breusch-Godfrey (order 1)	3.16*		6.18**

a: These t-ratios were calculated using the Delta method and indicate whether the long-run elasticities are statistically different from one.

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