Solow model makes two imp assumptions. First it assumes that as population rises so does employment....

Solow model makes two imp assumptions. First it assumes that as population rises so does employment. We can equate population, labour force and employment. Second it assumes that saving rate is relatively constant through time.

Qs: given the long run focus of Solow growth theory argue about the adequacy of the assumption and discuss why this assumption isn't suited to study the evolution of output over short run

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Rahul Sunny answered 1 month ago

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