Kindly discuss and explain in detail the following: What is the focus of Leontief paradox? How is it related to the production function? How does it affect economic growth modeling?
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Kindly discuss and explain in detail the following:
- What is the focus of Leontief paradox?
- How is it related to the production function?
- How does it affect
economic growth modeling?
Step by step
Solved in 2 steps
- Suppose that , the marginal product of efficiency units of labor, increases in the endogenous growth model. What effects does this have on the rates of growth and the levels of human capital, consumption, and output? Explain your results.What is the main takeaway implication of the Malthusian growth model? In particular, what policy recommendation did Malthus derive from the set of mechanisms he thought was operating in the economy?Why is a Cobb-Douglas production function useful for analyzing economic growth?
- Why do diminishing returns not limit growth in new growth theory? Diminishing returns do not limit growth in new growth theory becauseEconomic growth theories have discussed growth factors from various perspectives. Critically discuss the similarities and differences in growth factors based on Adam Smith's, David Ricardo's, and Harrod-Domar's theories.One of the important lessons of production functions used in modeling macroeconomic output and growth is the Leontief paradox. Discuss what is this paradox, how did this arise, and its implications on modelling economic growth.
- Suppose that , z the marginal product of efficiency units of labor, increases in the endogenous growth model. What effects does this have on the rates of growth and the levels of human capital, consumption, and output? Explain your results.Suppose you add a variable rate of population growth to a two-sector model of growth. Draw and properly label a graph on how the production function, investment requirement line, and saving line look like. Does the addition of the variable rate of population growth to this model help you explain anything that a simpler two-sector model with a fixed rate of growth, or a one sector model with variable population growth, cannot? Expound.As economic growth models become more and more inclusive of realistic conditions and incorporating complexities of the economy, disaggregation on inputs were introduced in capital (having physical and financial components). How does this labor disaggregation compare with that of capital, and its implications with less developed countries like the Philippines (aiming for a more robust economic growth)?
- Since the late 1950s, economists have performed “growthaccounting†studies in the United States.These have determined that ________________ is typically the mostimportant contributor to U.S. economic growth. a)physical capital b)human capital c)technology d)a market orientationWhy perfect competition is not assumed in the endogenous growth model? Explain. please try and keep the answer simpleRead the following extract and use it to answer question?The Accelerated and Shared Growth Initiative for South Africa (AsgiSA) was launched by Deputy President Phumzile Mlambo-Ngcuka in February 2006. After research and discussion with stakeholders, government identified six “binding constraints on growth” that needed to be addressed so as to progress in its desire for shared growth and to achieve its target of halving unemployment and poverty between 2004 and 2014. Thiscould be achieved if the economy grew at an average rate of at least 4.5% in the period to 2009, and by an average of 6% in the period 2010 to 2014.These binding constraints were: deficiencies in government’s capacity the volatility of the currency low levels of investment infrastructure and infrastructure services shortages of suitably skilled graduates, technicians and artisans insufficiently competitive industrial and services sectors and weak sector strategies inequality and marginalisation, resulting in many…