Based on the Solow Growth Model with Population Growth and Labour-Augmenting
Based on the Solow growth model with population growth and labour-augmenting technological progress,explain how each of the following policies would affect the steady-state level and steady-state growth rate of total output per person:
a.a reduction in the government's budget deficit
b.grants to support research and development
c.tax incentives to increase private saving
d.greater protection of private property rights
Explain how the Solow growth model differs from models of endogenous growth with respect to:
a.the sources of technological progress.b.returns to capital.
Income per person exceeds $25,000 in many countries,but is below $1,000 per person in many other countries.Based on the Solow growth model,suggest at least four possible explanations for this gap in living standards.
The economy of Macroland can be described by the Solow growth model.In Macroland the labour force grows at 3 percent per year,labour-augmenting technology increases at 2 percent per year,the saving rate is 15 percent per year,and the rate of capital depreciation is 10 percent per year.Choosing from among the following variables: output per effective worker,output per worker,total output,labour force,capital per worker,and capital per effective worker,which variables will be growing at a:
a.2 percent rate?
b.3 percent rate?
c.5 percent rate?
d.0 percent rate?