Questions tagged [economic-growth]
An increase over time in the quantity of goods and services produced within an economy.
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5 views
Unsure how to go about computing GDP for the following problem
I came across this question where the GDP for the years 1995-1997 is given. Then I was asked to compute the growth rate every year which I'm aware of.The next question was to compute the average which ...
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1answer
10 views
What's a « 1-Ratio» ? From a text on Capital's share of GDP
In this article, the writer talks about the «capital share, as a percent of GDP — here just 1 – labor share percentage»
What's this 1-labour share percentage?
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1answer
30 views
Why is entrepreneurship a factor of production?
I'm a student at a faculty of economics. The professor asked us a question to which I still can not find an answer, which is why entrepreneurship is part of the production factors?
I would be very ...
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1answer
23 views
I can't find (lny-lny0)/t meaning [closed]
I cannot understand what (lny-lny0)/t means. Of course we use this to show growth rate. But in the mathematical sense, I cannot know what it is. Is it diferrentiaion?
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0answers
11 views
what can be used as a proxy for Stock of Human Capital in an Economy?
I am an undergraduate student of Economics, currently in my Second year. I am writing an article wherein I need to show that Quantity of Skilled Labour is an important determinant of FDI inflow. A ...
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0answers
14 views
Empirical implementation of Milbourne et al's 2003 model of growth for time series data
I'm interested in testing the relationship of public investment in human capital and infrastructure, and the rate of growth of the GDP for Colombia, during a 20 years period. Given that I'm only an ...
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0answers
52 views
labor share and growth
Is there a link between the level of the labor share and growth?
In standard models growth is the rate of (labor augmenting) technical progress and labor force. So does that mean if the labor share ...
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2answers
29 views
A maximization program expressed by per capita variales - Ramsey model
I have a problem to be maximized with the following program
$$max\int_{0}^{\infty}\left\{ u\left(C\right)+\beta S^{\chi}\right\} e^{-\rho t}dt$$
s.t
$$\dot{K}=AK-C$$
$$\dot{S}=\left(1-S\right)S-\...
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1answer
31 views
Ramsey growth model - per capita vs aggregate variables
I am reading a paper Okuguchi,1981 with a Ramsey growth model. There is a constant population growth $n$ such as $L(t)=e^{nt}$. The way he writes the Hamiltonian is quite interesting (equation 5 on ...
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0answers
10 views
Economic history/geography of the UK (1960-today)
I am not an economist and I am looking for reference knowledge about how the economy of the UK (mainly focussing on England/Scotland/Wales) developed over the past 5 decades. The kind of information I ...
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2answers
60 views
Why is a Normal Yield Curve a sign of a healthy economy?
I think the question is pretty self explanatory. I'm just trying to understand the logic behind why an upward sloping yield curve indicates a good economy?
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1answer
26 views
Perpetual Youth Model
I am reading the famous paper of Blanchard,1985. There are some fundamental stuff that I did not really get.
1) Why they call it "perpetual youth"?
2) On page 225, he mentions the cohort size. So, ...
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2answers
21 views
Nominal Growth rate above Nominal Interest Rate
I'm reading Ray Dalio's "An In-Depth Look at Deleveragings", and at one point he's talking about central banks providing liquidity and credit support, and he states:
"This produces relief and, if ...
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1answer
17 views
Devising a model for inflation for a closed points system
I am working on a project that involves points. The idea is that users will earn points and redeem them for certain rewards.
The means via which the users earn are fairly limited (They can attend a ...
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0answers
14 views
Optimal Time-Consistent Fiscal Policy with Finite Lifetimes
I am reading Optimal Time-Consistent Fiscal Policy with Finite Lifetimes by Calvo and Obstfeld.
Here is the paper :
Calvo and Obstfeld (1988)
In fact, their model consists of two stages. In the ...
2
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1answer
47 views
Does credit really help an economy?
I'm reading Ray Dalio's How the Economic Machine Works, and although I understand the role of credit in an economy, I don't understand whether credit actually adds any value to an economy.
Ray says ...
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2answers
27 views
How does domestic demand affect the domestic currency's value
If an economy grows, due to a tax reduction for example, how does that affect the exchange rate?
My logic would be that reduced taxes put more money into people's pockets, which they then use to buy ...
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0answers
66 views
Improve my solution: Question on solow model
There is a question about Solow growth and Ramsey model,
compared to solow model, the Ramsey model is better to explain growth patterns across countries because it predicts a slower convergence ...
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1answer
208 views
Quarterly GDP growth: YoY vs QoQ / terminology
Quarterly GDP growth can be calculated either in terms of YoY change or - in the case of seasonally adjusted data - in terms of QoQ change. (A third option would be to annualize the QoQ rate.)
To ...
3
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0answers
37 views
Solow growth model deriving solutions
I was reading a note on Solow model in continuous time, and it said we can derive K, C, and Y from the key equation. But the steps were omitted, and I have no clue with it. How can I derive these ...
1
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2answers
67 views
Must a market-based economy constantly expand?
I vaguely recall from my reading of Adam Smith’s “The Wealth of Nations”, during college, that he opined that a market-based economy must constantly expand. Is this recollection correct and, if so, ...
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2answers
58 views
a question on the endogenous growth model
I have such a question on the endogenous growth mode”:
In the macroeconomics literature there are various ways in which the growth process in the Ransey-Cass- Koopmans model has been endogenized. ...
4
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1answer
51 views
Interpretation of the Cross Partials of the Cobb-Douglas
Consider a Cobb-Douglas Prod. Function $$Y=AL^{a}K^{1-\alpha}$$
This has the cross-partial:
$$\frac{\partial^2 Y}{\partial K\partial L}=(1-\alpha)\alpha AL^{\alpha-1}K^{-\alpha}$$
Is the ...
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1answer
75 views
Sustainable growth in the long run [closed]
Suppose that, in addition to physical capital and labour, an economy requires a fixed factor and a non-renewable resource to produce the final good. Prove that an economy with these input requirements ...
1
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1answer
46 views
Is there objective evidence that the US economy is “booming”?
I realize that it's the political pundits that are saying it, but they never seem to provide evidence that the economy is "booming". The dictionary definition of "booming" is having a period of ...
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0answers
42 views
Social conflicts in economic growth models
I'm highly interested in theories and models which explain how do social conflicts influence economic growth.
What papers on the topic can you recommend? I was searching for some seminal and most ...
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0answers
18 views
Raising the elasticity of substitution in an economy
Papers such as de la Grandville (1989) and Klump/de la Grandville (2000) have shown that a higher elasticity of substitution leads to higher economic growth. My question is, if there is a way to ...
6
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4answers
441 views
Can the stock market grow faster than GDP indefinitely?
My understanding of conventional wisdom is that average long-term growth of advanced economies is expected to be significantly lower than the average long-term growth of the value of the largest firms ...
2
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0answers
15 views
Size and influence of the regulatory/supervisory sector
I am interested in the size of what I call the regulatory/supervisory sector in Western economies. A regulatory/supervisory (R&S) activity involves either:
Determining a set of rules economic ...
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1answer
33 views
Economic impacts of Migration on the Labour Market
Many natives don't prefer foreigners taking their jobs, is it actually a bad thing for the countries economy?
2
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0answers
43 views
Reference Request: Primer on Relationship Economic Growth and Science / Technology
I'm in the early stages of planning a research agenda in this area, which means studying the current literature with an eye for further research opportunities.
The Economics of Science and ...
1
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1answer
41 views
How to check whether the production function below is neoclassical or not
Say I'm given the production function of the form
\begin{equation*}
Y= F(K,L,A) = (\alpha K^{\epsilon} + (1 - \alpha)Y^{\epsilon})^{\frac{1}{\epsilon}}
\end{equation*}
Where $\epsilon, \alpha \in (0,...
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1answer
22 views
Does GNI change once it has been published?
From what I understand, GNI is published for the last year once the year has ended
I am trying to have a look at the GNI for Korea for the past couple of years
The official GNI is published by ...
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0answers
57 views
Does Economic Growth Lead to Inflation?
As an answer to this question, it was stated that
Economists believe that higher growth rates tend to also mean higher
inflation rates.
As a non macro-economist, I am wondering if this is true? ...
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1answer
28 views
Disruption vs economic growth vs inflation
On the terms:
Disruption is when new players earn say 1m but take over of a 100m market segment, causing damage to well established but less innovative businesses
economic growth is what we read ...
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0answers
59 views
Estimating Endogenous vs Exogenous growth models
Exogenous economic growth models (mostly those that take technological progress, or change in TFP as exogenous and random) are rather easy to estimate econometrically.
But how about endogenous ...
6
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1answer
77 views
The Next Breakthrough of Growth Economics
Romer has once said, that the growth economics has not had a breakthrough after his work of endogenous model of 1990's. What could somehow prove his saying is that we rarely see the theoretical ...
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2answers
83 views
How does Bolivia maintain its high economic growth and the highest direct foreign investment in South America, despite its economic policies?
Nationalization of industries has always been anathema to foreign investment yet Bolivia now has the highest foreign direct investment despite Evo Morales' policies. Also not that it is always bad but ...
3
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1answer
58 views
Solution method in Smith (2006) A Closed Form Solution to the Ramsey Model
I am trying to understand the way Smith demonstrates that the general solution to his equation (12) is (13) (see page 6).
(12) \begin{eqnarray}
\dot{z} &=& (1- \alpha)\left[1-\left(\delta +...
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2answers
88 views
Does trade lead to economic growth in the most basic models of trade?
In the standard models of trade, such as Ricardo or Hecksher-Ohlin, I know that openness to trade will lead to increased consumption as (roughly) the consumption possibility frontier expands beyond ...
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0answers
27 views
Link between economic growth and income growth
We know that economic models such as AD-AS and the Keynesian model easily explain how economic growth leads to income growth.
But how does one explain in layman's terms how economic growth (a nation ...
4
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2answers
120 views
Reason for Economic Slowdown in Western Nations
Why do the U.S and other major Western Countries (e.g, Canada, Germany, in contrast to India, Australia, and China) have stagnated GDP growth? Comparing the GDP growth in the post-2000s from the 1990s ...
3
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1answer
42 views
Bernoulli transformation in “ A Close Form Solution to the Ramsey model” by Smith (2006)
I am trying to understand the way Smith arrived from (1) and (2) to (6) and (8).
Could anyone give me a hint? Thank you!
It is well known that the dynamics per capita consumption $c$ and capital $...
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0answers
34 views
What are some examples of places with steady state economies?
Referring to economies that over a long period of time have remained constant and not had significant growth or decline, not necessarily where this was intentional. How are they compared to different ...
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1answer
345 views
GDP versus GNP. Which is a better gauge of a country's economy size and prosperity?
Country A's GDP is larger than Country B's GDP. However, Country B's GNP is larger than Country A's GNP. Which country has a stronger economy? Which country's citizens is more likely to enjoy ...
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0answers
16 views
Question about Quantitative and Monetarist schools
What is the difference between Quantitative and Monetarist schools in terms of :
- Economic Growth
- Inflation
- The role of money
Specifically the difference between: Jean Bodin, Irving Fisher ...
5
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1answer
133 views
Labour-saving vs. Labour-augmenting technical change
I've read a number of posts on the above topic but none refers to published empirical papers. Google searches have been hopeless. Does anyone know of any paper on empirical derivation of technical ...
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1answer
45 views
A growth model with regime switch
I have a very general question. I am reading this paper :
http://www.webmeets.com/files/papers/eaere/2015/177/Discounting-HelsinkiBlind.pdf
There is a catastrophic event probability and after the ...
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1answer
203 views
Is inequality good for growth? [closed]
I was reading about the debate about income inequality and I would like to know your opinion on the matter.
Basically, the positions are two: the classical one, which states that inequality is good ...
2
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1answer
56 views
Can saddle path not go through the origin in Ramsey model?
In my case, the utility function is CEIS and discrete, the production fuction is $f(k_{t})=k_{t}^\alpha$, the budget constraint is $f(k_{t})+(1-\delta)k_{t}=c_{t} + k_{t+1}$. I use Jacobian matrix and ...
