Chapter 20: Problem 6
What policies can the government of a free-market economy implement to stimulate economic growth?
Chapter 20: Problem 6
What policies can the government of a free-market economy implement to stimulate economic growth?
All the tools & learning materials you need for study success - in one app.
Get started for freeHow is GDP per capita calculated differently from labor productivity?
Explain the difference between property rights and contractual rights. Why do they matter to economic growth?
Over the past 50 years, many countries have experienced an annual growth rate in real GDP per capita greater than that of the United States. Some examples are China, Japan, South Korea, and Taiwan. Does that mean the United States is regressing relative to other countries? Does that mean these countries will eventually overtake the United States in terms of the growth rate of real GDP per capita? Explain.
Say that the average worker in Canada has a productivity level of \(\$ 30\) per hour while the average worker in the United Kingdom has a productivity level of \(\$ 25\) per hour (both measured in U.S. dollars). Over the next five years, say that worker productivity in Canada grows at \(1 \%\) per year while worker productivity in the UK grows \(3 \%\) per year. After five years, who will have the higher productivity level, and by how much?
Education seems to be important for human capital deepening. As people become better educated and more knowledgeable, are there limits to how much additional benefit more education can provide? Why or why not?
What do you think about this solution?
We value your feedback to improve our textbook solutions.