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Your assumption is correct. Value added is Gross Output-intermediate consumption(inputs). value-added approach is a simple measure that ignores the difficulties of dealing with inter-industry and intra-industry flows of goods and services. Intermediate inputs are simply excluded here. The value-added approach provides a simple link of industry-level MFP ...


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tl;dr: R&D spending cannot stimulate economy during just by increasing long-run aggregate supply because recessions are fluctuations around the long-run aggregate supply and not necessary affected by the long-run aggregate supply. A in which spending on R&D in principle could be more effective in fighting recessions than other spending. The ...


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I found this excellent Economic Letter from the Federal Reserve Bank of San Francisco that speaks to this observation. It is from Carl R. Walsh (july 16,2004) (https://www.frbsf.org/economic-research/publications/economic-letter/2004/july/the-productivity-and-jobs-connection-the-long-and-the-short-run-of-it/ ) In this letter he notes that, newspaper ...


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Capital accumulation would still appear as investment GDP. Its possible theres other applications for this spending that would result in higher gdp. For example, GDP spiked in ww2 because military spending happens to be very efficient at inflating GDP. So it is intuitively plausible that potential output is hidden by rising investment- the closest equivalent ...


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I agree with @1muflon1's comment that this is quite broad, because AGI can be defined in many different ways. For instance, do we consider simple learning tasks as AGI or metacognition? This is a brief survey of AGI startups, but another point to keep in mind is that few startups/firms are actually gunning for AGI because we generally have problems in other, ...


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this is attributed to better computer-production technology in the US. But what is that technology? Is it better physical capital, in the form of computer-building machines? Is it better human capital? In a sense yes. For example, typical Cobb-Douglas function with capital labor and human capital would look like this: $$Y = A K^{\alpha} L^{\beta} H^{1-\...


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The logic you presented is known as technological unemployment. It is true that due to technological improvements, you would need less people to do the same amount of work. But along with technological progress, you would need more highly skilled workers to operate these high-tech machinery. What Mankiw meant (at least according to me) is that the demand ...


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Economics cannot answer your question. Economics as a discipline discarded normative assumptions ("what is good?") in order to deal with issues around price. This was a sound academic decision (Hey bro, how much for your kidney, no seriously, how much for both your kidneys). As a result economics don't answer for "better" but for "more." There is another ...


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