Question

D. Now, provide short answers to the following questions.

i. At first patents might seem like a deterrent to growth because in effect they restrict the use of new technology. Yet many economists believe that patents generate growth. Explain why.

ii. Some economists argue that it is possible to raise the standard of living by reducing population growth. As an economist interested in incentives rather than coercion, what kind of policy would you recommend to slow population growth?

C. Now, provide short answers to the following questions.

i. Between 1929 and 1933, NNP measured in current prices fell from $96 billion to $48 billion. Over the same period, the relevant price index fell from 100 to 75. What was the percentage decline in nominal NNP from 1929 to1933? What was the percentage decline in real NNP from 1929 to 1933? Show your work.

ii. You find that your paycheck for the year is higher this year than last. Does that mean that your real income has increased? Explain carefully.

iii. U.S. real GDP is substantially higher today than it was 60 years ago. What does this tell us, and what does it not tell us, about the well-being of U.S. residents?

Answer 1

i) During the passage of time, the patent system has evolved with a view to promote innovation and encouraging economic development. By offering exclusive rights for a limited period, an inventore may recover R&D costs and investment. It also promotes investment to commercialize and market new inventions. Many countries, in partcular least developed countries, have only begun to address the challenges of setting up an appropriate patent system in place to reap economic and social benefits. The development of these countries' resources and infrastructure and their capacity to benefit from the rapid growth of intellectual property as a valuable economic asset in the world economy remain an urgent concern. It also benefit the companies by providing a system for trading knowledge internationally through licence agreements.

ii) Population growth can be slowed, stopped and reversed through actions which enhance global justice and improve people's lives.

Measures taken to Slow down the population growth:

• Bring Birth Rate Down: In the last ten years alone, fertility rates in Asia dropped by nearly 10%. Thailand, reduced its fertility rate by nearly 75% in just two generations with a targeted, creative and ethical family planning programme.
• Educating Girls: Where women and girls have economic empowerment, education and freedom, they choose to have smaller families. Greater freedon usually leads to greater uptake of family planning and ending child marriage pushes back the age at which women have their first child which often reduces family size. When family size are smaller, that also empowers women to gain education, take work and improve their economic opportunities.
• Removing Barriers to Contraception: Currently, more than 200 million women who want to avoid pregnancy are not using modern contraception. Reasons are -  lack of access to contraceptives, concerns about the side-effects of contraception and social pressure not to use it.
• Alleviating Poverty: Decreasing child mortality, improving education and providing people with economic opportunities all help to reduce fertility and population growth.
• Challenging assumptions about Family Size and Contraception: Across the world, some people choose not to use contraception because they are influenced by assumption, practices and pressures within their nations or communities. Work with women and men to change attitudes towards contraception and family size has formed a key part of successful family planning programmes.

iii)