GROWTHCLASS

# GROWTHCLASS - 1 Economic Growth Â GROWTH Â¢ 3.22 real GDP...

This preview shows pages 1–4. Sign up to view the full content.

This preview has intentionally blurred sections. Sign up to view the full version.

View Full Document

This preview has intentionally blurred sections. Sign up to view the full version.

View Full Document
This is the end of the preview. Sign up to access the rest of the document.

Unformatted text preview: 1 Economic Growth Â¡ GROWTH Â¢ 3.22% real GDP per year Â¢ 2% real per capita GDP per year (â€˜50-â€™09) Â¡ GDP/Pop Â¡ Doubles every 36 years â€“ rule of 72 Â¡ Doubled since 1972 Â¡ PRODUCTIVITY 1 Â¢ Output per worker (manhour) Y/L Â¢ Y=Y/L*L Â¢ Y/POP=Y/L*L/POP Â¡ Interrupted but ongoing Â¡ Antigrowth vid, malthus Growth is Relatively New 2 In the News? 3 2 Course Issues Â¡ Final exam Weds 12/22 8am College Ave Gym Â¡ Speed Networking Â¡ Target 4 Application -Growth Rates of Real Per Capita GDP Â¢ China in 2000 = U.S. in 1870 start 2000 % ch U.S. 1870 3,347 34,260 1.8 U.K. 1870 4,107 23,550 1.35 Japan 1890 1,256 26,460 2.8 China 1900 598 3,940 1.9 5 Pak 1900 616 1,960 1.16 Â¢ China catch-up 2% v 9% 2009 figures Â¢ (41,646)e ( n*.02 )=(2,494) e ( n*.09 ) -> 41,646/2,494 = e ( n*.09-.02 ) Â¢->ln(41,646/2,494)= ln(e ( n*(.09-.02 ) )= ln(16.6)=n*.07=2.809/.07=40.13 years Â¢ US: 41,646e(40.13*.02)=92,926 Â¡ Note China now, where U.S. was in 1860-70? BUT If the long-run aggregate supply curve is vertical, how can we have economic growth? Â¡ Shifts right over time Â¡ Production function Â¢ y=f(K L tech natural 6 Â¢ y=f(K,L,tech,natural resources) Â¢ Increase in L, K, tech etc Â¡ Vertical means Y not func of P Â¡ Potential and Actual GDP 3 Costs and Benefits of Economic Growth Â¡ Benefits Â¢ progress Â¢ Increased output, income/ wealth...
View Full Document

{[ snackBarMessage ]}

### Page1 / 8

GROWTHCLASS - 1 Economic Growth Â GROWTH Â¢ 3.22 real GDP...

This preview shows document pages 1 - 4. Sign up to view the full document.

View Full Document
Ask a homework question - tutors are online