We consider two countries A and B in a given period. It is observed that in the A and B the average growth of labour is equal (2%) according to employment statistics but the average GDP growth rates in A and B are respectively 5% and 4%. What are the alternative explanations of this GDP growth rate differences? You have to base your arguments not only on the capital stock and TFP average growth rates but also on the factors that are determining these growth rates.

We consider two countries A and B in a given period. It is observed that in the A and B the average growth of labour is equal (2%) according to employment statistics but the average GDP growth rates in A and B are respectively 5% and 4%. What are the alternative explanations of this GDP growth rate differences? You have to base your arguments not only on the capital stock and TFP average growth rates but also on the factors that are determining these growth rates.

MACROECONOMICS FOR TODAY

10th Edition

ISBN:9781337613057

Author:Tucker

Publisher:Tucker

Chapter20: Growth And Less Developed Countries

Section: Chapter Questions

Problem 19SQ

See similar textbooks

Similar questions

We consider two countries A and B in a given period. It is observed that in the A and B the average growth of labour is equal (2%) according to employment statistics but the average GDP growth rates in A and B are respectively 5% and 4%. What are the alternative explanations of this GDP growth rate differences?
According to investopdia.com,a steady-state economy is an economy structured to balance growth with environmental integrity, seeking to find an equilibrium between production growth and population growth. This type of economy aims for the efficient use of natural resources but also seeks a fair distribution of the wealth generated from the development of those resources. Is this type of economy more plausible than continued, unlimited economic growth? Why or why not?
An increase in net investment leads to faster economic growth because capital per worker and output per worker will change in which of the following ways?Capital per Worker Output per worker(A) Increase. Increase(B) Increase. Decrease(C) No change. Increase(D) Decrease. Increase(E) Decrease. Decrease
Suppose that K(2021)/N < K(2015)/N, where K(2021) is capital in year 2021 and K(2015) is capital in year 2015. Output per worker, Y/N, in year 2030 is ____ in year 2015. equal to less than greater than
Does a country need to be well endowed with natural resources in order to experience rapid long-term economic growth
If a nation's real GDP is growing by 6 percent per year, its real GDP will double in approximately ________. Answer to 2 decimal places.
Suppose that in a particular country, nominal gross domestic product(GDP) grew by 8 percent and the GDP deflator increased by 10 percent. The country's growth rate of real GDP would be approximately equal to?
Which of the following is true of the growth in the U.S. economy from 1950 to 2007? Growth resulting from technology > growth resulting from human capital > growth resulting from physical capital Growth resulting from technology > growth resulting from physical capital > growth resulting from human capital Growth resulting from physical capital > growth resulting from technology > growth resulting from human capital Growth resulting from human capital > growth resulting from technology > growth resulting from physical capital
Assume that the growth rate of the capital stock in each period is determined by the level of output in the previous period. 1) An economy of 80 million people has ten percent of them engaged in research and development, where their productivity is 0.0035. The economy is on a balanced growth path, when suddenly 2.88 million people move from goods production into R&D, raising the fraction there to 13.6 percent. In the one period that begins with this labor reallocation, the growth rate of output is ________. [Refer to the instruction above.] A) 2.8% B) 0.0% C) 3.8% D) 2.2%
What are the two major determinants of the overall growth of the economy according to the view of economic growth based on labor data?
Real GDP per capita is 49,773 (measured in constant 2017 International Dollar, same for the following numbers) in the year 2019 for Canada, and 62,491 for the United States. Real capital stock per capita is 225,268 in the year 2019 for Canada and 209,866 for the United States. Decompose the differences in real GDP per capita between Canada and the United States into the contribution from productivity and that from capital accumulation. Explain using your results why real GDP per capita is lower in Canada than in the United States. You can use a capital share α of 1/3.
The CDB said that its projection of growth comes after an extremely difficult year in which the economies of its 19 borrowing member countries (BMCs) contracted by 12.8 percent on average due to the onset of novel coronavirus. “In 2020, the majority of BMCs registered double-digit declines in GDP. Countries with significant tourism industries, such as The Bahamas, Barbados, Belize, Cayman Islands, Dominica, and Grenada, were hard-hit by a more than 70 percent drop in overnight visitors in 2020, which spilled over to affect other economic sectors. An increase in agricultural production in Jamaica could not prevent the economy from shrinking by 10.4 percent. Agriculture in Belize was affected by a severe drought from the previous year and then a reduction in tourism-related demand. The economy contracted by 13.3 percent. Guyana was the only economy to record economic growth (26 percent), solely due to the start-up of its first oil production. However, growth was lower than expected due…