Consider the neoclassical growth model. The economy is in the steady state. An increase in population growth rate will lead to an increase in the capital per worker in the steady state. an increase in the output per worker in the steady state. an increase in the investment per worker in the steady state. a decrease in the capital per worker in the steady state.

Consider the neoclassical growth model. The economy is in the steady state. An increase in population growth rate will lead to an increase in the capital per worker in the steady state. an increase in the output per worker in the steady state. an increase in the investment per worker in the steady state. a decrease in the capital per worker in the steady state.

Economics (MindTap Course List)

13th Edition

ISBN:9781337617383

Author:Roger A. Arnold

Publisher:Roger A. Arnold

Chapter17: Economic Growth: Resources, Technology, Ideas And Institutions

Section17.2: A Production Function And Economic Growth

Problem 3ST

See similar textbooks

Similar questions

Based on the Neoclassical Growth Model explain in detail what are the critical determinants of economic growth. Also, specify related assumptions.
Neoclassical regional growth theory focuses exclusively on the role of ___________ as the fundamental determinant of changes in local labor market or metropolitan area output. A. Demand B. Supply C. Both demand and supply D. None of them
The neoclassical theory of growth identifies the steady-state rate of growth as the _________ just sufficient to keep ____________ constant while labour grows. technology, productivity consumer demand, output investment, capital per person savings, investment
The neoclassical growth model predicts absolute convergence for countries with the A. same technology. savings rate, and population growth B. technology and savings rate, but different rates of population growth C. same technology and population growth, but different savings rates D. same population growth and savings rate, but different levels of technology
Suppose that output is given by the neoclassical production function Y (t) = F (K(t), L(t), A(t)) satisfying Assumptions 1 and 2, and that we observe output, capital, and labor at two dates t and t + T . Suppose that we estimate TFP growth between these two dates using the equation Where g(t, t + T ) denotes output growth between dates t and t + T , and other growth terms are defined similarly, while αK(t) and αL(t) denote the factor shares at the beginning date. Let x(t, t + T ) be the true TFP growth between these two dates. Show that there exist functions F such that x(t, t ˆ + T )/x(t, t + T ) can be arbitrarily large or small. Next show the same result when the TFP estimate is constructed using the end-date factor shares: Explain the importance of differences in factor proportions (capital-labor ratio) between the beginning and end dates in these results.
Why does neoclassical economics emphasize growth?
consider the generalized Romer model where the fishing-out effect and the decreasing returns to research are allowed. suppose the number of researchers grows 5% each year and labor-augmenting technology level grows 1% each year. then, there exists an upper limit for the fishing-out effect in steady state. evaluate whether is true, false or uncertain and why?
Compare the similarities and the differences between the Economic Growth concept by the Neoclassical School of Thought with Keynesian System for Economic Growth.
Q3. The Lewis-Fei-Ranis model of economic development with unlimited suppliesof labour is a neoclassical model that was used to explain the development processin the LDCs. Discuss its limitations and how relevant it is in explaining their dualstructures.
Modified True or False One of the criticisms of Neoclassical and free-market theory of development is its no insight on how countries initiate and sustain development.
In this question, you will explore how changes in the saving rate and the rate of technological progress affect an economy’s growth. In addition, you will examine how the golden rule saving rate depends on the production function. Consider the Solow (neoclassical) growth model with aggregate production function Y = K^alpha(AN)^(1-alpha). Each period lasts a year.
Explain how each of the following events or policies will affect unemployment in a neoclassical model: tax cut for consumers a rise in business confidence that increases investment a fall in export sales to a major trading partner a rise in income levels for consumers throughout the economy cheaper imported products a fall in government spending