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- What are the advantages of backwardness for economic growth?Consider the endogenous growth model with two sectors: manufacturing firms and research universities. Which of the following affect/s the steady-state growth rate of output in this model? (i) stock of knowledge (ii) fraction of labor force in universities (iii) saving rate O a. Only (ii) O b. Only (iii) O c. Only (i) O d. (i), (ii), and (iii)Question One. Answer the following pertaining to the growth theories. a) Derive the elasticity of the balanced-growth-path level of output with respect to savings rate. b) The Romer growth model assumed that growth rates if capital and knowledge are endogenously determined. Derive the growth rates of capital and knowledge. I want a answer in 15 min
- Hi, can you please help me to solve this macroeconomics question. Describe the version of the endogenous growth model with capital. Explain the assumptions of the model together with the key equations describing the law of motion of the growth rates of technology and physical capital. Explain how it depends on the degree of returns to scale to technology and physical capital in knowledge production.n the endogenous growth model, suppose that there are three possible uses of time. Let u = the fraction of time spent working s = fraction of time spent neither working nor accumulating human capital (unemployment) 1 – u – s = fraction of time spent accumulating human capital If z = 1, b = 5, and the economy begins in period 1 with 100 units of human capital, find the values of Y, H, and Y’ for each of the scenarios below. In this model, does the scenario with the greater human capital accumulation lead to the highest per capita income (Yes/No)? u s H Y H' Y' .7 .05 100 .6 .15 100 .6 .05 100 .5 .10 100 Does the scenario with the greater human capital accumulation lead to the highest per capita income (Yes/No)?1. Many endogenous growth models feature so called scale effects: per capita growth rises when population growth rises. Some economists have criticized these models for this reason, since countries with faster population growth do not in general appear to also experience faster per capita income growth. Consider an economy that has access to a production technology Y = AKª L¹-a where Y is output, A is the level of technology, K is capital and L is the amount of labor in the economy. Capital evolves according to K = SY (thus, the depreciation rate 6 = 0). The population growth rate is n. (Throughout, gx, where x can be any of the variables in the model). i. Assume that technology is determined by A =BK What sort of endogenous growth model is this? Find gk in terms of the K, L, and other parameters of the model. ii. Write an expression for gy in terms of gk and g₁. What must be true for a balanced growth path to exist in this model? Solve for the balanced growth path value of gy and gy,…
- Suppose that , z the marginal product of efficiency units of labor, increases in the endogenous growth model. What effects does this have on the rates of growth and the levels of human capital, consumption, and output? Explain your results.How can we measure growth over the very long run? Te poorest countries in the world have a per capita income of about $600 today. We can reason-ably assume that it is nearly impossible to live on an income below half this level (below $300). Per capita income in the United States in 2015 was about$51,000. With this information in mind, consider the following questions.(a) For how long is it possible that per capita income in the United Stateshas been growing at an average annual rate of 2% per year?(b) Some economists have argued that growth rates are mismeasured. Forexample, it may be difcult to compare per capita income today with percapita income a century ago when so many of the goods we can buy todaywere not available at any price then. Suppose the true growth rate in thepast century was 3% per year rather than 2%. What would the level of percapita income in 1800 have been in this case? Is this answer plausible?Explain Economic Growth in Poor Countries....or Lack Thereof. Takenote of the 3 Paragraphs in bold font in your explanation. Poor countries just need more physical capital, you say? Easterly points out that between 1960 and 1985, the capital stock per worker in both Gambia and Japan rose by over 500%. The result? In Gambia, output per worker over the 25-year period rose 2%; in Japan, output per worker rose 260%. So, it must be that poor countries need more human capital? Again, he finds startling comparisons. For example, human capital expanded faster in Zambia than in Korea, but Zambia’s annual growth rate is 7 percentage points below Korea’s. Too much population growth? Too little? More foreign aid? Too much? As Easterly proceeds, writing a prescription for growth seems ever more difficult: “None has delivered as promised,” he concludes (p. xi).
- Population Growth and Technological Progress – Work It Out PLEASE WRITE ANSWERS CLEARLY An economy has a Cobb-Douglas production function: Y = K“(LE)'-a The economy has a capital share of 0.30, a saving rate of 42 percent, a depreciation rate of 4.00 percent, a rate of population growth of 5.25 percent, and a rate of labor-augmenting technological change of 3.5 percent. It is in steady state. b. Solve for capital per effective worker (k*), output per effective worker (y*), and the marginal product of capital. k* = y* = marginal product of capital =4. Assume our endogenous growth model with 0<1. Now assume that a more open immigration policy suddenly boosts the US population growth rate to a higher constant rate: n'. Graph the short and long-run effects of this in a graph of the growth rate in ideas over time.Give typing answer with explanation and conclusion The production function is given by Y=AK, where K is the capital stock and A denotes the level of technology and equals 1.2 (the rate of technological progress equals 0). The rate of population growth is 2% and people save 15% of their incomes. The capital stock is 12000 and consumption of fixed capital is equal to 120 (and it always represents this percentage of the capital stock). Calculate the rate of growth of output per worker.
