Development and Growth - Theories of Economic Growth - The Solow growth model

Question

explain what delta k = sy = (n+d)k means

Answer 1

delta k is positively related to savings/worker, delta k is negatively related to population growth, deprciation erodes the capital stock.
Net it determines wheter capital will be increasing or decreasing

Answer 2

you should look to the demografic data, to say something about the distribution of k per workers and the following y.

Answer 3

at steady state, increase anymore of k, but total kapital does increase by population growth and also Y increases with this rate. The 'pie becomes bigger'

Answer 4

It has:

a production function y=f(k)
saving function s*y
amount of new capital needed because of n and d rate (n+d)k

Answer 5

until steady state. It increases per worker because of the savingsrate, but decreases for n, until 'snijpunt'

Answer 6

The potential level of output per worker in the long run, based on the endogenous production factor capital

Answer 7

when s increases, Steady state moves to the right, k gardual increases, so y increases in the LR. Therefore there can also be a temporally growth of Y

Answer 8

Economies in the world who save, might have hiher standards of living

Answer 9

If the nummer of people increases, then the k decreases, which leads to a steady state with a lower Y. .
However total economy increases from n to n* (zie boek)
if the nummer of peolple decreases, k increases, which leads to capital deepening. (so a higher y)

Answer 10

One country has a higher steady-state level of y then the other country
if they have different points in the transition to steady state. Steady state is better, since y is higher at the same n (certeris paribus for all things > situtation the same)

Answer 11

It gives insights in the effects of savings, I, population growth and especially technology change on growth.

Answer 12

it does not provide the complede pathway which says how certain factors have influenced the economic growth
It looks to productivity as a exogenous factor.

Answer 13

because of technology change there is less capital per worker needed, to keep capital per worker constant there should be more investments in new capital