北京外国语大学《宏观经济学》课件-第4章Growth and Policy.pptxVIP

MACROECONOMICSLesson 4北京外国语大学《宏观经济学》 Chapter 41. Review of Neoclassical growth theory2. Endogenous growth theory3. Growth traps and two-sector models4. The poverty trap5. Lessons from the Asian Tigers 1. Review of Neoclassical growth theory _Key Results The steady-state rate of growth of per capita income is determined by the rate of technical progress.The savings rate will increase the steady-state level of income although it does not affect the stead-state growth rate.Convergence: poor countries will eventually catch up with rich countries. 1. Review of Neoclassical growth theory_Weakness Why the economy exists no growth in the steady-state when there is no technology in the model. Technological progress is essential for long-term growth, it does not clarify which factors affect such progress Chapter 41. Review of Neoclassical growth theory2. Endogenous growth theory3. Growth traps and two-sector models4. The poverty trap5. Lessons from the Asian Tigers 2. Endogenous Growth TheoryPaul Romer, “Increasing Returns and Long-Run Growth”, Journal of Political Economics, 1986New Growth Theory or Endogenous Growth Theory AK ModelAssume a production function with a constant marginal product of capital and with capital as the only factor. AK ModelAssume that the savings rate is constant at s and that there is neither population growth nor depreciation of capital. The higher the savings rate, the higher the growth rate of output. 2. Endogenous Growth Theory _ Model And the Production function Assume thatWhat is the result of the growth rate of output per capita? 2. Endogenous Growth Theory _ ModelA higher savings rate generates a high growth rate. High rates of population growth and depreciation lead to a low growth rate. The Mechanics of Endogenous GrowthSolow Model: y = kαAK Model : y = akPrivate and social returns to capitalExternalInvest on human capitalRD 2. Endogenous Growth Theory _ Empirical AnalysisConvergence or not ?(n+d)kk*k0k1sy(n+d)kk0syky 2. Endo