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1answer
39 views

Is UK house price spiral connected to debt based monetary system?

(cross-posted from Personal Finance & Money) Is the monetary system's debt basis* driving government policy on housing and property, and how could this ultimately affect personal housing ...
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2answers
70 views

Why some countries are wealthier than others?

Twin-peak of economic growth is one of the concepts discussed in economics. Most of explanations for poverty traps are baseed on the lack of infrastructures and public goods. How could be another main ...
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1answer
59 views

A recursive production function

I've been reading a book on a Kaleckian economics model, but there is a recursive function that has been bothering me. Can anyone provide some insight into why the equation why designed like this? ...
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2answers
50 views

on economic growth and Second Welfare theorem

While I was studying eighth edition of Mankiw's Macroeconomics, in chapter 9 on Economic Growth(pg. 245), the author mentions : "Some economists have proposed increasing the incentive to save by ...
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0answers
32 views

Simple Neoclassical Growth Model with Elastic Labor and Non-Standard Capital Adjustment Costs

I have the following social planner problem to maximize $\{c_t, k_t, n_t \}$ $\begin{gather*}E_0 \sum_{t=0}^\infty \beta^t U(c_t, 1 - n_t), 0 < \beta < 1\end{gather*}$ subject to ...
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2answers
93 views

Why the total value of the whole economy is constantly appreciating?

Take S&P for example. In the long run it just keeps climbing. Same for the market as a whole. Why would this happen? Why the market keeps going up (in the long term) all the time? (source)
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2answers
132 views

Deriving the golden-rule savings rate in a Solow Model

Consider an economy described by the per worker production function function: $$y = f(k) = 2k^\frac{1}{2}$$ and a depreciation rate $δ$ of $.05, 5%$. Considering what we know to be true of the ...
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1answer
37 views

What happens to effective consumption and capital in the Ramsey/Cass-Koopmans(RCK) model when technological growth decreases?

Is the conclusion that both decline correct? Both long and short run. Let $g_x$ denote growth rate of $x$, $g_c$ the growth rate of $\hat c$. In the model there is no depreciation so, $$ g_c = \frac ...
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1answer
61 views

Solow model: Partial derivative of y with respect to n

This is a really basic question regarding the solow model, I am trying to find the derivative of $y$ with respect to $n$. All I need to do is take the partial derivative $\frac{\partial y}{\partial ...
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1answer
33 views

How to intuit a necessary optimality conidtion involving growth rate of Lagrange multiplier in Ramsey growth model?

I encountered a necessary optimality conidtion involving growth rate of Lagrange multiplier in this note on Ramsey model $$\frac{\dot \lambda}{\lambda} = \mathcal {v} - (f^\prime(k)-\delta-\xi)$$ in ...
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2answers
144 views

Inflation and economic growth

Noticeable works about the impact of inflation on economic growth are dated back to the 90s. For example, Barro (1995): the impact effects from an increase in average inflation by 10 percentage ...
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2answers
66 views

Should we expect more structural technological unemployment if growth becomes more limited by natural resources and less by labour?

Technological unemployment, where unemployment arises from (with some oversimplification) workers being replaced by machines, has so far been temporary as new jobs were created that replaced the old ...
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1answer
30 views

Can we “prove” that slow growth is due to deficient demand?

We hear more and more these days about growth, particularly in the Eurozone and Britain, being beneath its long-term trend due to deficient demand. I can think of a few things which support that idea ...
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1answer
21 views

Macroeconomic formulas for global limited raw material economy exist?

Macroeconomics basic formulas are referring to a model in which the raw material are unlimited. Also the efficiency of production is a consequence of the pressure done by consumers (that buy the most ...
3
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1answer
43 views

Multiplicative factorization of stochastic growth time series--solving for an eigenfunction/eigenvector

I'm trying to understand the tools used/presented in Lars Hansen's Econometrica paper "Dynamic Valuation Decomposition within Stochastic Economies." In a part in the paper, Hansen introduces a ...
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2answers
63 views

Will China's GDP be greater than the USA's and Europe's combined?

A newspaper said in 2080 China can be a developed country, with a bigger population. Does that mean China's GDP is going to be bigger than the USA's and Europe's combined? Also, is this possible even ...
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3answers
187 views

Does Inflation Make Money Eventually Worthless?

I used this calculator: http://www.buyupside.com/calculators/inflationjan08.htm to estimate the future worth of 100 dollars in 100 years at 2% inflation. Does this really mean that a decent meal at a ...
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0answers
18 views

growth accounting, innovation, productivity and institutional analysis

I am looking to design a study which would have the following elements: 1) growth accounting using provincial data of a Asian country. 2) empirical research investigating link between innovation and ...
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3answers
69 views

Growth Accounting

In growth accounting the production function is defined as follows: $$Y= AF(K,L) $$ That means output $Y$ is dependent upon capital $K$, labour $L$ and technology $A$. Now to produce something, in ...
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3answers
92 views

Why is economic growth measured exponentially rather than linearly?

If economic growth is indeed highly desirable (see this question), why must this growth be exponential? With finite resources, exponential growth might hit limits rapidly (or be impossible?). Why not ...
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1answer
102 views

Is indefinite exponential economic growth possible?

Economic growth is frequently expressed as a % of GDP. Proponents of a steady-state economy postulate that perpetual exponential economic growth is impossible and that any system relying on it is ...
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1answer
103 views

Are there fundamental reasons why (exponential) economic growth is highly desirable?

One of the most widely published measures of the economy is the economic growth as a % of the GDP; i.e. the degree to which an economy grows exponentially. In my understanding, when the rate of ...
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0answers
10 views

Data: Directed Technical Change

I'm interested in technologies that are directed towards improving productivity of workers with high human capital. What kind of data could one use to look at directed technical change, as in ...
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1answer
59 views

Banking System, Canada & US

Why are the way banks are established and spread out in Canada and US so different? Canada: There are only six major banks and most products offered are very competitive. Its almost unusual to hear ...
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2answers
76 views

Schumpeterian Business Cycles

The basic idea of Schumpeterian Business Cycles is that new technologies require creative destruction but will yield positive growth. These two opposing forces have impacts onto the real economy at ...