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Does a higher rate of saving lead to higher growthtemporarily or indefinitely?

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

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The Accelerated and Shared Growth Initiative for South Africa (AsgiSA) was launched by Deputy President Phumzile Mlambo-Ngcuka in February 2006. After research and discussion with stakeholders, government identified six “binding constraints on growth” that needed to be addressed so as to progress in its desire for shared growth and to achieve its target of halving unemployment and poverty between 2004 and 2014. This could be achieved if the economy grew at an average rate of at least 4.5% in the period to 2009, and by an average of 6% in the period 2010 to 2014.These binding constraints were: deficiencies in government’s capacity the volatility of the currency low levels of investment infrastructure and infrastructure services shortages of suitably skilled graduates, technicians and artisans insufficiently competitive industrial and services sectors and weak sector strategies inequality and marginalisation, resulting in many economically marginalised people being unable to…