Solow Model vs The Data: Long-Run Growth Rates Quiz
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Questions and Answers

What are the two main factors that contribute to GDP per capita differences between the richest and poorest countries?

  • Labor force participation and education levels
  • Exchange rates and trade policies
  • Capital per person and TFP (correct)
  • Government spending and inflation rates

    • In the Solow model of capital accumulation, what does endogenous capital accumulation mean?

  • Capital is predetermined and constant
  • Capital is influenced by external factors only
  • Capital is determined within the model itself (correct)
  • Capital is not a factor in economic growth

    • In the context of the Solow model, what does Robert Solow study as an engine for economic growth?

  • Natural resource availability
  • Total factor productivity
  • Physical capital accumulation (correct)
  • Labor force participation

    • What is the research question posed regarding capital accumulation and sustainable income per capita growth?

    <p>Can capital accumulation alone maintain sustainable income per capita growth?</p> Signup and view all the answers

    Which model was developed by Robert Solow in the 1950s to study capital accumulation's role in long-run economic growth?

    <p>Solow Model</p> Signup and view all the answers

    What aspect of economic growth does the Solow model primarily focus on?

    <p>Long-run steady-state levels of GDP per capita</p> Signup and view all the answers

    What does the term 'income convergence' refer to in the context of poorer countries catching up with richer countries?

    <p>'Poor countries' economies becoming aligned with 'rich countries'</p> Signup and view all the answers

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