宏经PPCh11mac教程.pptVIP

Instructor Notes: 1) Investment demand increases to ID1. 2) The real interest rate rises to 6 percent a year, and investment increases to $1.5 trillion. 3) As a result, the quantity of capital and real GDP begin to grow. Instructor Notes: 1) A technological advance increases the productivity of capital and increases the demand for capital to KD1. 2) The real interest rate rises. 3) But so do investment and saving. 4) As the capital stock increases, the KS curve shifts rightward toward KS1. 5) The real interest rate falls. 6) When the real interest rate has fallen to its long-run target rate, the supply of capital stops increasing, the capital stock is constant at $20 trillion, and growth ends. Instructor Notes: 1) The capital supply curve shifts rightward successively through KS1, KS2 , KS3 , and so on. 2) As capital grows, real GDP grows but the real interest rate does not fall because there are no diminishing returns. 3) Real GDP growth continues indefinitely. Instructor Notes: 1) Technological advance shifts the productivity function upward. 2) Here, an advance in technology shifts the productivity function from PF0 to PF1. 3) With this technological advance, real GDP per hour of work increases from $25 to $32 when there is $60 of capital per hour of work. Instructor Notes: 1) Between 1960 and 1973, which was a period of rapid productivity growth, capital per hour of work increased from $49 to $61, and technological progress shifted the productivity function upward from PF0 to PF1. 2) Between 1973 and 1983, when potential GDP grew slowly, capital per hour of work increased from $61 to $70 and the productivity function shifted to PF2. 3) The effect of technological change was offset by oil price shocks. 4) Between 1983 and 1995, capital per hour of work increased from $70 to $78 and technological progress shifted the productivity function upward from PF2 to PF3. 5) Although productivity growth was not as rapid as in the 1960s, the productivity growth rate did