The growth patterns of the key macroeconomic variables in the US data are highly unbalanced. In particular, over the 1963 – 2012 period, output and stock of structures increased by 2.63 and 3.24 times, respectively; the stock of equipment increased by more than 30 times; the population of skilled and unskilled workers increased by 6.30 and 1.39 times, respectively; the price of equipment relative to the price of consumption went down by more than 9 times; and the skill premium (defined as a ratio of wages of skilled to unskilled labor) was growing at an average rate of 1% per year. Conventional stationary or balanced-growth real business cycle models cannot account for such unbalanced growth pattern. We construct an unbalanced – growth general equilibrium model with two types of capital – equipment and structures – and two types of labor – skilled and unskilled. In the context of constant elasticity of substitution production function, the capital-skill complementarity mechanism is remarkably successful in explaining growth patterns in the US macroeconomic data.

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