Long Run Growth

  1. The ________ tells us how long it takes real GDP per capita, or any other variable that grows gradually over time, to double.
    Rule of 70
  2. often referred to simply as productivity, is output per worker.
    Labor productivity
  3. Consists of human-made resources such as buildings and machines.
    Physical Capital
  4. The improvement in labor created by the education and knowledge embodied in the workforce.
    Human Capital
  5. The technical means for the production of goods and services.
  6. The Sources Of Long-run Growth:
    • Labor productivity
    • Increase in Physical Capital
    • Increase in Human Capital
    • Technological Progress
  7. Why Growth Rates Differ?
    • Savings and investment spending
    • Foreign investment
    • Education
    • Infrastructure
    • Research and development
    • Political stability
    • The protection of property rights
  8. The Role Of Government In Promoting Economic Growth:
    • Government Policies.
    • Protection of Property Rights
    • Political Stability and Good Governance
  9. Measured as changes in real GDP per capita in order to eliminate the effects of changes in the price level and changes in population size.
  10. (T/F) Levels of real GDP per capita vary greatly around the world: more than half of the world’s population lives in countries that are still poorer than the United States was in 1907.
  11. Over the course of the twentieth century, real GDP per capita in the United States increased _____.
  12. The key to long-run economic growth is rising, ________, which is output per worker.
    labor productivity
  13. Increases in productivity arise from increases in ___________ per worker and human capital per worker, as well as advances in technology. The aggregate production function shows how real GDP per worker depends on these three factors.
    physical capital
  14. __________, which estimates the contribution of each factor to a country’s economic growth, has shown that rising total factor productivity is key to long-run growth. It is usually interpreted as the effect of technological progress.
    Growth accounting
  15. A prime factor is differences in savings and investment rates. Technological progress is largely a result of __________.
    research and development
  16. Fits the data only when factors that affect growth, such as education, infrastructure, and favorable policies and institutions, are held equal across countries.
    convergence hypothesis
Card Set
Long Run Growth
Last Semester