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image (Fundamentals (Productivity :arrow_up: (Income :arrow_up:, Saving …
Growth
Y=AF(K,N)
Terms
A=Productivity
K=Capital
Y=Output
N=Labor
aN=Labor Elasticity
aK=Kapital Elasticity
Accounting
1B :small_red_triangle: Y/Y = Output Growth
1A :small_red_triangle:K/K = Capital Growth
3C :small_red_triangle: N/N = Labor Growth
2 aK, aN
3 aK, aN (K,N)
4 A
Solow
Ct = Yt - It
Ct = Ct/Nt = Consumption per worker
Kt = Kt/Nt = Capital Stock per worker
Capital-Labor Ration
Yt = Yt/Nt = Output per worker
Steady State
Yt,Ct,Kt = Constant
Ct
Golden Rule Capital-Labor ration
K*
St = Yt
Fundamentals
Growth (n) :arrow_down:
Consumption :arrow_down:
Output :arrow_up:
Productivity :arrow_up:
Income :arrow_up:
Saving :arrow_up:
Capital :arrow_up:
Saving (s) :arrow_up:
Investment :arrow_up:
Capital :arrow_up:
Endogenous
Def
S&I Dependent (Endo)
S :arrow_up: I :arrow_up:
Productivity (Exo)
MR = Constant
K :Arrow_up Human :arrow_up:
R&D
Y=AK
policies
Human Dev
R&D
Infrastructure
