Question

In: Economics

3. In the Solow model with technical progress, capital shallowing can occur because of Question 3...

3. In the Solow model with technical progress, capital shallowing can occur because of

Question 3 options:

depreciation.

technological growth.

population growth.

all of the above.

4.

According to the Solow model with the technical progress, the expected co-efficient for saving is

Question 4 options:

1.47

0.5

-0.5

1.91

Solutions

Expert Solution

3). The correct option is (a).

Depreciation.

As we know that in Solow's model the technical progress is labour augmenting. It affects the model in same way as population growth does. The capital shallowing is measured by the growth in capital input over the growth in labour input. If capital input grows slower than the growth in labour input, then the amount of capital per worker declines. This is known as capital shallowing.Capital shallowing occurs because old capital depreciates, or becomes completely obsolete with the passage of time.

4). Dear student due to incomplete question I cannot answer the second question. It needs equation to solve....

Kindly comment the equation I will provide you the answer..

Thanks...

The Solow model is an exogenous growth model of economic growth that determines changes in the level of output in an economy over time as a result of changes in the population.

Rahul Sunny answered 7 months ago
Next > < Previous

Related Solutions

Consider an economy that is described by the Solow model without technological progress, and that is...
Consider an economy that is described by the Solow model without technological progress, and that is on its balanced growth path. Suppose that the citizens of the country decide that, in order to spur economic growth, henceforth each worker will work from 9 to 6 each day instead of from 9 to 5. Describe how this change affects the paths of output per worker and capital per worker over time.
Verify that the following are true in the basic Solow growth model with no technological progress...
Verify that the following are true in the basic Solow growth model with no technological progress and no population growth: (a) The real rate of return R/P is constant along the BGP (b) The real wage W/P is constant along the BGP (c) The capital to labor ratio K/N is constant along the BGP (d) The capital to output ratio K=/Y is constant along the BGP How do these results match up to the Kaldor and Kuznets stylized facts?
The Solow model A does not explain technological progress but, instead, takes it as exogenously given...
The Solow model A does not explain technological progress but, instead, takes it as exogenously given B seeks to explain technological progress and therefore treats it as an endogenous variable To incorporate technological progress, we write the production function as Y = F(K, L x E), where (choose one or more) A E is the efficiency of labor B L x E is the effective number of workers C g is the rate of labor-augmenting technological progress D n is...
Question 8 Evolution of the Solow Model. In introducing constant technological growth, the General Solow Model...
Question 8 Evolution of the Solow Model. In introducing constant technological growth, the General Solow Model addressed what weakness of the Basic Solow Model. Introducing the Human Capital Model helped address what 2 weaknesses of the General Solow Model.
Distinguish between labour-augmenting technical change and neutral technical change. Explain, using a Solow-model diagram, how the...
Distinguish between labour-augmenting technical change and neutral technical change. Explain, using a Solow-model diagram, how the technological progress affects the steady state levels of capital-labour ratio and output per person.
An economy is described by the standard Solow model without technological progress and without population growth....
An economy is described by the standard Solow model without technological progress and without population growth. You are given the information that the savings rate dropped to a lower level in this economy, but you don’t know by how much it did so. Suppose that prior to the drop in s the economy was in a steady-state with a capital stock per worker higher than the Golden Rule level. a. In a graph which should include the production function, the...
An economy is described by the standard Solow model without technological progress and without population growth....
An economy is described by the standard Solow model without technological progress and without population growth. You are given the information that the savings rate dropped to a lower level in this economy, but you don’t know by how much it did so. Suppose that prior to the drop in s the economy was in a steady-state with a capital stock per worker higher than the Golden Rule level. a. In a graph which should include the production function, the...
Exercise 1. Solow Model – Foreign Aid Consider a Solow economy that begins with a capital...
Exercise 1. Solow Model – Foreign Aid Consider a Solow economy that begins with a capital stock equal to $300 billion, and suppose its steady -state level of capital is $500 billion. To its pleasant surprise, the economy receives a generous gift of foreign aid in the form of $100 billion worth of capital (electric power plants, machine tools, etc.) a) Use the Solow diagram, other graphs, and mathematics of the Solow model to explain what happens to the economy,...
In the Solow growth model, capital exhibits diminishing returns. In a basic endogenous growth model, capital...
In the Solow growth model, capital exhibits diminishing returns. In a basic endogenous growth model, capital exhibits constant returns. What is the main implication of these differences to economic growth of a country/countries?
This is a calculation question involving the Solow model. There are three parts to the question....
This is a calculation question involving the Solow model. There are three parts to the question. Part (a) asks for the steady state level of k for a 'Solow country.' Part (b) asks for the steady-state level of y for the same country. Part (c) asks you to calculate a new savings rate for the country to satisfy certain conditions. You have to answer all three parts of the question in the box provided. Please make it clear what part...
ADVERTISEMENT
Subjects
ADVERTISEMENT
Latest Questions
ADVERTISEMENT