武汉大学金融系各科课件初级宏观The Process of Economic Growth.pptVIP

1. What is Economic Growth(568R-569R) Growth of total output Per capita growth Difference between growth and development 2. Sources of Growth (569R-572R) Human Capital Natural Resources Capital Formation Technological Progress 3. Theories of Economic Growth (573L-579R) 3.1 Classical Theories Smith’s Golden Age: --Free Land, no Capital and Technological Change --Output grows with the growth of population --Real wage remains constant (no rent due to free land) Malthus’ Dismal Science --Fixed land and expanding population --Diminishing returns to labor input --Real wage stays in subsistence level 3.2 Zero Growth Theories (574L-575R) Theory of Growth Limits because of limited resources Theory of Skeptical Growth Value Growth destroys natural environment 3.3 Economic Growth with Capital Accumulation and Technological Progress: The Neoclassical Model(575R-579L) ----Competitive economy and full employment ----Labor growth is given, ----Capital accumulation leads to capital deepening ----With capital deepening, marginal return to labor and real wage tend to rise, return to capital decreases. ----A long-run steady state will occur finally if no technological change.Output per worker stagnates. ----Technological progress leads to rising real wage, increasing living standard, and rising interest rate. 3.4 New Growth Theory: Inquire into Sources of Technological Progress (579L-R) In Neoclassical Model of economic growth, technological progress is exogenous. But NGT treats it endogenous. ------Technological progress is a produced factor ------The difference between rich countries and poor countries can be attributed to technological differences ------It is a public product or “non-rival” goods -------Inventions are expensive to produce but inexpensive to reproduce ------Public policy is needed to protect intellectual property right. 4. Growth Accounting (582R-58