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Questions tagged [economic-growth]

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

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0answers
59 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
42 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?
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49 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 ...
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1answer
96 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
25 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
88 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
33 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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139 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 ...
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1answer
88 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
157 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 ...
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1answer
90 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
169 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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2answers
390 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 ...
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1answer
51 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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1answer
1k 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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1answer
220 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
53 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
413 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 ...
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1answer
86 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 ...
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2answers
197 views

Is the locus of consumption in Ramsey growth model a vertical line?

In almost all documents I have read on the internet, the locus of consumption where $C_{t} = C_{t+1}$ seems to be a vertical line as shown below. However, my teacher said it could well be not a ...
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1answer
362 views

Difference between Maximum Output and Potential Output

In macroeconomics, what is the difference between potential output and maximum output? Or they are simply equivalent concepts? If they are different, how can we graph it in comparison to LRAS on AD-AS ...
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1answer
48 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: $$\dot x=f(x)$$ ...
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1answer
70 views

Was there a Role of Technology in Macroeconomic Models before Solow?

Was the role of technological progress formalised by Solow (1956) for the first time? or at least he provided the initial formal insight into the role of technological progress in economic growth?
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1answer
151 views

How would gross world product look like if fossil fuel is treated as capital and not as income?

The idea to treat fossil fuel as capital is found in the first chapter of the book "Small is Beautiful: (A Study of) Economics as if People Mattered" (1973) by E. F. Schumacher. Is there recent ...
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1answer
25 views

Discrete returns versus log-returns

I read this link and it is very helpful. However, if log-returns are easier for time-aggregation, then why do economists work with discrete returns e.g. in GDP growth?
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How to pin down the bias and its/their sources in derived technical change indices?

Using the following CES function I backed out factor-augmenting indices $A_1$ and $A_2$ using OECD country level macro data. This process is akin to Solow's (1956) method for deriving technology ...
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1answer
305 views

What is the fundamental problem with Pakistan's economy?

Why is Pakistan repeatedly defaulting? 2008 - Pakistan seeks USD9 billion IMF bailout to avert crisis 2013 - Saudi Arabia come to Pakistan’s Rescue with USD15 Billion Energy Bailout Deal 2014 - ...
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1answer
143 views

Industrial Revolution: Induced technical change and factor shares

I have been reading about various explanations for the British industrial revolution. A strand of research lead by Allen (2009) tries to provide an incentives based explanation whereby high wage and ...
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2answers
696 views

Proxies for technological change in an economy?

I am writing a paper on the application of Value-Added TFP to measurement of technological change. Just thinking of throwing in a few variables into my regression. I have ICT capital share (as seen in ...
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1answer
306 views

Has US real median personal/household income been stagnant since the late 1970's/early 1980's?

This is referring to an earlier question: Why are real median household incomes stagnant? How do the following graphs actually tell you that US real median personal/household income has been stagnant ...
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1answer
65 views

Does the existence of insurance markets negate the broken window fallacy?

In the wake Harvey and Irma, I did some reading on the Broken window fallacy. It makes sense on it's face that after paying the glazier for the broken window, the shopkeep could not spend his six ...
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69 views

Sources of Growth and co-integration: production function approach

I am experimenting with time series data to gauge the importance of factors of production i.e. labour force, capital stock, energy, land, etc. in output growth. One venue I am looking into is the ...
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1answer
569 views

Cobb-Douglas nested in CES model

Assume, using the following equation $Y=[((A_1L)^\alpha K^\beta)^\sigma+ (A_2X^\gamma)^\sigma]^{1/\sigma}$, we back out (obtain) the evolution of $A_1$ & $A_2$. Can we interpret $A_1$ as labour-...
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1answer
55 views

Who said that growth would stop because of satiation?

I have a vague recollection I am unsuccessfully trying to find an exact reference for. I recall watching an interview of Jacques Attali about a new book of his (maybe 6 or 7 years ago) where he ...
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0answers
187 views

Creative destruction and quality-adjusted inflation rate.

I'm reading this article in VoxEU.org, and there's the following paragraph: If the statistical office is correct to assume that the quality-adjusted inflation rate is the same for creatively ...
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1answer
5k views

How is wealth created? [duplicate]

The production of 'goods and services' and 'innovation' is the usual answer. I feel that doesn't really answer the question. These things can be traded for wealth but they don't generate new wealth. ...
3
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1answer
96 views

Induced technical change vs. directed technical change

I am trying to get a better grip on the literature on directed technical change and induced technical change. In other words, I am trying to understand if these concepts are the same and used ...
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2answers
94 views

Is there any index which relates population growth rate with food production growth rate?

I would like to know if there is an index which shows if food production growth is keeping pace with population growth worldwide. I know there are population growth rates available, for example for ...
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1answer
182 views

During an economic expansion, how do the ratios of Return on Equity and Return on Asset are affected?

From my perspective, during an economic expansion, industrial production, employment, personal incomes and sales are increased excluding the inflation rate. To be more specific, companies buy new ...
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1answer
48 views

Is NIIP a good measure of a country economical development?

In another question I asked someone pointed me to an answer where NIIP (Net International Investment Position) was mentioned as a measure of economical development, which I already heard about it and ...
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1answer
62 views

Which measures are there to evaluate a country economical development? [duplicate]

I'm familiar with the measures of Gross domestic product (GDP PPP) total, per capita and GDP nominal total and per capita. But I'm not sure if these measures evaluate the economical development of a ...
0
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1answer
52 views

Human capital for under developed countries

I am currently undergoing a study on economic growth in 11 countries: Bangladesh, Egypt, Indonesia, Iran, Mexico, Philippines, Pakistan, South Korea, Turkey and Vietnam. I plan to use panel regression....
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2answers
115 views

Determinants of economic growth in ARDL model - nominal or real variables?

I'm investigating the determinants of economic growth of my country. Some of them are of long term other are of short term. For that I'm trying to construct an ARDL model, but I'm confused about the ...
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2answers
688 views

What is the danger of (China's) investment-led growth as opposed to consumption-led growth?

I keep reading that China must switch to consumption-led growth or productivity-led growth, that investment-led growth is 'dangerous.' I understand that it is probably not sustainable in the sense ...
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1answer
717 views

Increase in per capita GDP always means GDP is growing?

This question was asked in very popular civil services examination. Question is : Whether the following statement is correct or not? Statement : If a country is experiencing increase in its per-...
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2answers
733 views

Basic Solow Growth Model: Stability Proof

I am reading through McCandless "The ABCs of RBCs" this summer to get a preview of what I need to know for the coming Fall semester. It did not take long to find a statement that I can easily accept ...
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1answer
187 views

How would unlimited free energy affect the global market? [closed]

What will the effect on today's global market if a new source of free unlimited energy was to be discovered? How badly will it disrupt today's global market and how badly will it affect our currency? ...
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1answer
341 views

Updating MRW (1992) with PWT 9.0

I'm trying to rework Mankiw, Romer, Weil (1992) with fresh data. From their paper: n: workforce growth rate We measure n as the average rate of growth of the working-age population, where working ...
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1answer
54 views

How to estimate a constant elasticity of substitution for a country in a solow model including human capital and scarce resources

For my thesis I was looking for some help due to the facts of my little knowledge of econometrics. I appreciate any help whether its directly dealing with my question or literature advice. Basically ...
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2answers
232 views

Phase Diagram - growth model

The dynamics of Ramsey-Cass-Koopman growth model is usually summarized in phase diagrams with the 2 equations (conventional symbols apply): \begin{align*} \frac{\dot c}{c}=&\frac{r-\rho}{\theta}\\ ...