10. Long-Run Economic Growth Sources and Policies

10. Long-Run Economic Growth Sources and Policies - given...

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Long-Run Economic Growth: Sources and Policies - Industrial Revolution – the application of mechanical power to the production of goods, beginning in England around 1750 In the long run, small differences in economic growth rates result in big difference in living standards Growth rate matter because an economy that grows too slowly fails to raise living standard - Economic growth model – a model that explains growth rates in real GDP per Capita over the long run - Labor Productivity – the quantity of goods and services that can be produce by one worker or by one hour of work - Technological Change – a change in the quantity of output a firm can produce using a
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Unformatted text preview: given quantity of inputs-Main Sources of Technological Change 1. Better machinery 2. Increase in Human capital the accumulated knowledge and skills that workers acquire from education and training or from their life experiences 3. Better means of organizing and managing production -Per-Worker Production Function the relationship between real GDP per hour worked and capital per hour worked, holding the level of technology constant Technological change helps economies avoid diminishing returns to capital-New Growth Theory a model of long run economic...
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This note was uploaded on 01/19/2012 for the course CIT 230 taught by Professor Staff during the Fall '08 term at Oakland University.

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