Questions tagged [economic-growth]

An increase over time in the quantity of goods and services produced within an economy.

Filter by
Sorted by
Tagged with
1
vote
1answer
25 views

Is there any fundamental reason that output elasticity of capital $<1$ in general?

In Solow growth model, if one perturb the saving, there is convergence of old equilibrium capital to new equilibrium capital as investment breaking point capital is attractor. However, in derivation ...
6
votes
6answers
927 views
+100

What is the relevance of economic growth?

Economic policies often mention high economic growth as a desirable path. For example, "We started to lay a new foundation for stronger, more durable economic growth." -- President Obama, ...
-2
votes
1answer
37 views

Solow model and the dynamics of aggregate variables [duplicate]

I'm trying to find what the dynamics of the aggregate variables in the Solow model (capital K, output Y and consumption C) Specifically, I'm looking for is how a sudden drop in population affects ...
0
votes
0answers
20 views

In Solow growth model, increasing consumption drops production which should measure GDP?

Consider Solow growth model $Y=F(K,AL)$ where $A$ measures knowledge progress, $K$ is capital and $L$ is label. I have suppressed temporal dependence. I am going to assume $L$, $A$ grow exponentially ...
3
votes
3answers
66 views

Proving a result In Jones (1999) “Growth: With or Without Scale Effects”

Jones (1999) builds his semi-endogenous growth model where output is produced with only one input, labour, in the following "research" function: $$ Y = A^\alpha L_Y $$ Labour is augmented with ...
1
vote
1answer
48 views

What is the relationship between population growth and economic growth?

Population Growth is only one of several factors of influence on economic growth but it is not strictly necessary for the economy to grow. I have also heard of the term called the population bonus - ...
1
vote
3answers
122 views

Where the economic growth of a society come from?

I'm thinking about value generating. I hear it a lot in a innovation context, i.e. one should create a new product that a lot of people want to buy. I can see how a new product can value more than ...
2
votes
1answer
76 views

Research question formation

I am in the process of starting a research paper (for those in the IB Board, this is the Extended Essay) and I had previously formed my research question like this: To what extent will factor x ...
2
votes
5answers
672 views

In GDP growth studies, are factors of production measured as stock or flows?

Consider the following cases: One machine (capital) is used by multiple producers within one year. For instance, farmers renting tractors from the same company. In this case, in terms of GDP, there ...
0
votes
1answer
20 views

Is the steady state of k enough to show Y grows at the rate n+g?

To provide some context for the question: I was approached by a student needing help for a an empirical thesis based on Solow-Swan model. She had trouble solving the theoretical model she wanted to ...
-1
votes
0answers
21 views

How can $5 Trillion Economy be achieved? [closed]

*******We all are acquainted with the fact indeed a vision possessed by the Indian Prime Minister Hon. Narendra Modi and the Indians of turning India into 5 trillion in less than 4 years hence. Taking ...
5
votes
1answer
57 views

In economic modelling, how are we sure the linearized equilibria behave similarly to original equilibria?

The following problem is in the context of continuous time, although I suspect something could be said about discrete time also. Let's assume that we have the following equation: $$\dot x=f(x)$$ ...
1
vote
1answer
27 views

Attributing Labor Productivity Gains to Capital Deepening vs. Total Factor Productivity Growth

In a traditional Solow-Swan growth model, you can decompose growth in labor productivity (output/hour) into a component stemming from total factor productivity growth and another stemming from capital ...
0
votes
1answer
3k views

Quarterly GDP growth terminology: YoY vs QoQ

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 ...
2
votes
1answer
128 views

Analytically tractable Ramsey model: how to solve ODE for optimal trajectories

In Brunner and Strulik (2002) the authors claim, that the solution of \begin{align} \dot c &= \frac{c}{\sigma}(\alpha k^{\alpha-1} - \delta - \rho)\\ \dot k &= k^\alpha - \delta k - c \end{...
0
votes
0answers
20 views

Calculating real wage in the previous year?

If in the base year the real wage is $.489, inflation in previous year was 5.8% and total wage growth was 13.5%, what was the real wage one year ago? I know at the base nominal wage = real wage. Thus,...
0
votes
2answers
104 views

German economic growth in the 20th century

Regarding this great animation: Animation: The World’s 10 Largest Economies by GDP (1960-Today) I have the following questions: Why did Germany's GDP shrink so much from 1995 to 2000, while the GDP ...
0
votes
0answers
14 views

Replicating a Fertility Choice Model

I'm working on the Ahtiuv&Moav work of fertility choice and economic growth. When I want to maximice the main problem I can not do it because I dont know which mathematical tool I should use. ...
1
vote
2answers
66 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 ...
1
vote
0answers
6 views

Implications for Labour after a Productivity Shock, RBC Model

I am trying to understand the implication for labour after a one time productivity shock where $A_t$ follows a AR (1) process with persistence $\rho_A=0.95$. It is stated the following : labour ...
5
votes
1answer
300 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 ...
0
votes
1answer
27 views

Wage Growth Rate in the R&D Model

I am trying to understand the R&D model and how to calculate the growth rate of wage in this model. There is no equation given, but it’s stated that : household income must equal total ...
0
votes
1answer
25 views

FDI - Foreign Direct Investment

If in the sector foreign direct investments (FDI) are not stable, for instance, increasing dramatically in one year, decreasing next year. fluctuation continues over ten years, what FDI can say about ...
0
votes
0answers
17 views

Ramsey Model and Transversality Condition

I am trying to understand the intuitive interpretation of the TVC. I have two expressions from two different household optimisation problems that should be actually similar or equal intuitively as ...
5
votes
2answers
666 views

Growth theory / Initial GDP: positive coefficient sign

I estimated growth regressions for several EU countries. In each of them, the sign of "initial GDP"'s coefficient is statistically significant but positive, which contradicts growth theory as well as ...
0
votes
1answer
155 views

annualized quarterly growth rate calculating

I was using R to calculate the annualized quarterly growth rate of real GDP by 400*diff(log(rgdp)). If I perform in this way some of the percentage change is big. However, if I calculate as 100*diff(...
0
votes
1answer
18 views

How can autonomous private spending change budget surplus?

I was reading Keynesian economics in R.Dornbusch's book where he mentioned the defects of using budget surplus as a measure where he says it can be changed and effected by autonomous private spending ...
1
vote
0answers
66 views

What are some common causes of jobless growth?

While "jobless recovery" is often discussed in the aftermath of recessions in Western countries, it seems it's always a short-lived phenomenon. On the other hand, it looks like in other parts of the ...
0
votes
0answers
12 views

How do I convert change over a ten-year period into annual growth rate?

I am working on an econometrics project where I need to find the impact of climate change on agriculture in India. The project requires me to use an existing econometric model from some peer reviewed ...
0
votes
1answer
25 views

Is it reasonable, in panel data, to use past values of explanatory variables as instruments to deal with simultaneous causality?

I am trying to examine the determinants of economic growth, essentially regressing a number of variables upon economic growth. I face a problem that there is likely simultaneous causality between many ...
1
vote
0answers
11 views

New Keynesian Model Output Gap and Calibration

I am trying to solve following problem regarding the New Keynesian Model: So, I have calculated following equations by using the Taylor Rule, Phillips Curve and IS Curve: $$\pi=\frac{\kappa\phi_y}{(1-...
2
votes
1answer
31 views

Log linearising EUler equation

I am trying to solve a problem that asks to log linearise following Euler equation of the New Keynesian model: $$C^{-\sigma}_t=\beta E_tC^{-\sigma}_{t+1}(1+i_t)/(1+\pi_{t+1}).$$ The solution is ...
0
votes
0answers
19 views

Elasticity of substitution, marginal rate of substitution and price ratio

so there is a problem I do not know how to tackle: The is an utility maximisation problem and the solution to the Lagrangian leads to:$$\frac{C_1}{C_2}=(1+\rho)^\frac{1}{\sigma}(\frac{P_1}{P_2})^\...
0
votes
1answer
48 views

Maximizing units under a budget constraint and increasing costs

Consider two columns. Column A has total cost per day, Column B has units bought that day. The marginal cost of each unit is increasing because of limited supply. My goal is to estimate total ...
0
votes
1answer
16 views

Endogenous Growth in the case of externalities (Learning by doing)

so for the Learning by doing model productivity is defined as $$A_t=BK_t$$. Inserting this into the optimum conditions leads us to the following:$$r_t=\alpha BL^{1-\alpha}$$ and $$w_t=(1-\alpha)B^{1-\...
0
votes
0answers
21 views

Ramsey Model Market Clearing Condition

I have a problem understanding the market clearing condition for aggregated equilibrium in the Ramsey model. Market clearing implies that all resources are used up, hence: $Y_t=C_t+I_t$ , where $Y_t$ ...
0
votes
1answer
20 views

Difference between Luxury/Premium/Value fashion segments? What does “value” mean here?

I was reading this article on Quartz: https://qz.com/1485141/just-20-fashion-companies-are-making-almost-all-of-the-industrys-profits/ I do not understand the following graph shown: What does "value"...
1
vote
2answers
47 views

Does the US Bureau of Economic Analysis use the generic growth formula to calculate percent change of GDP?

My question is so basic, I'm embarrassed to ask it. (I study computational theory, not economics.) I'm looking at quarterly GDP numbers and growth rates. I've tried to arrive at the BEA's CPGDPAI ...
0
votes
0answers
32 views

Which model gives a more accurate representation of growth?

Does the Solow model or the combined Romer - Solow model give a more accurate representation of growth?
0
votes
1answer
22 views

Interaction between productivity growth and interest rates

Isabel Schnabel, Member of the Executive Board of the European Central Bank point at the interview out "The real interest rate (...) emerges from the economy’s growth potential in the long run.“ https:...
0
votes
0answers
18 views

Equilibrium in currency devaluation?

In export oriented Economy, we often come across currency devaluation as means to boost exports. As per my understanding (please correct me if I am wrong), currency devaluation will immediately bring ...
1
vote
1answer
54 views

Are there economic models that predict (only) a medium/long-term negative effect of protectionism?

Going by some ECB models/estimates from last year, protectionism would result in negative consequences pretty fast, e.g. For illustration, I will use the results of simulations carried out by ECB ...
0
votes
1answer
55 views

Does migration exacerbate (albeit delay) the problem of aging, economically-inactive populations in Western societies?

As a layman, I've always understood that there is a general consensus amongst economists that "immigration is economically beneficial" to rich Western countries (like Britain) who have aging ...
9
votes
4answers
2k views

Macroeconomics for Mathematicians

I'm coming from a math background (so my mind is set up for Definitions-Observation-Lemma-Proof frameworks) and looking for recommendations of a Macroeconomics textbook mainly devoted to growth models ...
0
votes
1answer
36 views

Country specific economic recession/financial crisis data?

Many financial crises are at the global level, yet some of them can be country-specific, especially the ones connected with political instability. For example, the 1990 recession of Russia, the 1958 ...
1
vote
1answer
24 views

Understanding GDP vs Real GDP

I am totally new to Economics. I have issues understanding GDP and real GDP. I have listed 3 statements below, can someone tell me if those makes sense ? GDP Gross Domestic Product is used to get an ...
0
votes
0answers
27 views

When does increasing government spending lead to economic growth and when does it lead to stagflation?

Obviously increasing government spending endlessly will lead to inflation. What I ask is: when can an increase in government spending, when the economy is in a recession, lead to economic growth ...
1
vote
1answer
73 views

What is the upper limit of circulating money on earth?

I've come up with this question while discussing the topic of customer-perceived value with coworker. Is there a theoretical upper limit to all circulating money in this world? To avoid inflation ...
0
votes
0answers
20 views

Regarding global economic slow down

I heard in news that world is going through,the economic slow doing may be because of us China trade war or any other reason. and India is one of the country which affected by this slowdown, but ...
-2
votes
1answer
26 views

Steady state growth of output

In the long run Solow steady state, the growth rate of output in a country is g + n. If there is some other country with exactly the same properties of the first country and the same initial ...

1
2 3 4 5
7