Technological progress should decrease the required capital output ratio giving

Technological progress should decrease the required

This preview shows page 2 - 3 out of 3 pages.

Technological progress should decrease the required capital-output ratio, giving more growth for a given level of investment The mechanisms of Econ growth & development would be simply a after of increase Saving rate for US less than 12% The main obstacles and constraint in most countries, causing relatively low level of new capital formation Sources of saving gap: international saving Foreign aid Private foreign investment International saving - loans Contributions of Harrod This model justices massive transfers of capital and technical assistance from development to less developed nations The HD model what determines GR 1 Y fck 2 K capital 3 s saving rate 5 saving of Y ST 4 5 investment I s investment change in capital ok 6 Capital output ratio 0 c how much eachunit of T is K c t I efficiency ofcapital translating into output 8 at 8k ok OY d ok
Image of page 2

Subscribe to view the full document.

theHDmodel Y FCK direct relationship bit K Y by a constant k capitalstock E 8 E measures efficiency S net saving rate of T c capital output ratio 0 C how muchk change as I change OT E o kC how much outputis I saving investment cidentity ofsaving investment produced by eachunit of K I net investment ok S s f so SY S I ok c OY C 0 of ok s C c of E efficiency of capital accumulation E OI 0kt OT C Er E _o f a of the HD mode song investment tells under deep cod couty what saving rate reduce technology ear increase the output a ratio ogy t newww eto agave names G the keg is given to the role of saving a invesima of vi storm
Image of page 3
  • Fall '17
  • Ana De Andrade
  • Capital accumulation, Linear Growth Models

What students are saying

  • Left Quote Icon

    As a current student on this bumpy collegiate pathway, I stumbled upon Course Hero, where I can find study resources for nearly all my courses, get online help from tutors 24/7, and even share my old projects, papers, and lecture notes with other students.

    Student Picture

    Kiran Temple University Fox School of Business ‘17, Course Hero Intern

  • Left Quote Icon

    I cannot even describe how much Course Hero helped me this summer. It’s truly become something I can always rely on and help me. In the end, I was not only able to survive summer classes, but I was able to thrive thanks to Course Hero.

    Student Picture

    Dana University of Pennsylvania ‘17, Course Hero Intern

  • Left Quote Icon

    The ability to access any university’s resources through Course Hero proved invaluable in my case. I was behind on Tulane coursework and actually used UCLA’s materials to help me move forward and get everything together on time.

    Student Picture

    Jill Tulane University ‘16, Course Hero Intern

Ask Expert Tutors You can ask 0 bonus questions You can ask 0 questions (0 expire soon) You can ask 0 questions (will expire )
Answers in as fast as 15 minutes