• Share
  • Email
  • Embed
  • Like
  • Save
  • Private Content
Econ growth
 

Econ growth

on

  • 304 views

 

Statistics

Views

Total Views
304
Views on SlideShare
251
Embed Views
53

Actions

Likes
0
Downloads
0
Comments
0

1 Embed 53

http://classes.indianaonlineacademy.org 53

Accessibility

Upload Details

Uploaded via as Microsoft PowerPoint

Usage Rights

© All Rights Reserved

Report content

Flagged as inappropriate Flag as inappropriate
Flag as inappropriate

Select your reason for flagging this presentation as inappropriate.

Cancel
  • Full Name Full Name Comment goes here.
    Are you sure you want to
    Your message goes here
    Processing…
Post Comment
Edit your comment

    Econ growth Econ growth Presentation Transcript

    • 17 - 1Copyright McGraw-Hill/Irwin, 2002Growth EconomicsProduction Possibilities AnalysisSupply Determinants of Real OutputGrowth in the AD-AS ModelU.S. EconomicGrowth RatesAccounting forGrowthProductivity Growthin the New EconomyKey TermsPreviousSlideNextSlideEndShowECONOMICGROWTH ANDTHE NEWECONOMY17C H A P T E R
    • 17 - 2Copyright McGraw-Hill/Irwin, 2002Growth EconomicsProduction Possibilities AnalysisSupply Determinants of Real OutputGrowth in the AD-AS ModelU.S. EconomicGrowth RatesAccounting forGrowthProductivity Growthin the New EconomyKey TermsPreviousSlideNextSlideEndShow•Increases in the Quantity &Quality of Natural Resources•Increases in the Quantity &Quality of Human Resources•Increases in the Supply (orStock) of Capital Goods•Improvements in TechnologyGROWTH ECONOMICSSupply Factors
    • 17 - 3Copyright McGraw-Hill/Irwin, 2002Growth EconomicsProduction Possibilities AnalysisSupply Determinants of Real OutputGrowth in the AD-AS ModelU.S. EconomicGrowth RatesAccounting forGrowthProductivity Growthin the New EconomyKey TermsPreviousSlideNextSlideEndShow•Households, Businesses, andGovernment Must Purchase theEconomy’s Expanded OutputGROWTH ECONOMICSDemand FactorEfficiency Factor•The Economy Must AchieveEconomic Efficiency as well asFull-Employment
    • 17 - 4Copyright McGraw-Hill/Irwin, 2002Growth EconomicsProduction Possibilities AnalysisSupply Determinants of Real OutputGrowth in the AD-AS ModelU.S. EconomicGrowth RatesAccounting forGrowthProductivity Growthin the New EconomyKey TermsPreviousSlideNextSlideEndShowPRODUCTION POSSIBILITIES ANALYSISEconomicGrowthABCDabCapitalGoodsConsumer Goods
    • 17 - 5Copyright McGraw-Hill/Irwin, 2002Growth EconomicsProduction Possibilities AnalysisSupply Determinants of Real OutputGrowth in the AD-AS ModelU.S. EconomicGrowth RatesAccounting forGrowthProductivity Growthin the New EconomyKey TermsPreviousSlideNextSlideEndShowPRODUCTION POSSIBILITIES ANALYSISGrowth and ProductionPossibilitiesLabor and ProductivityWorker-HoursLabor-Force ParticipationRateLabor ProductivityReal GDP =WorkerHoursXLaborProductivity
    • 17 - 6Copyright McGraw-Hill/Irwin, 2002Growth EconomicsProduction Possibilities AnalysisSupply Determinants of Real OutputGrowth in the AD-AS ModelU.S. EconomicGrowth RatesAccounting forGrowthProductivity Growthin the New EconomyKey TermsPreviousSlideNextSlideEndShow•Size ofemployed laborforce•Average hoursof work•Technologicaladvance•Quantity of capital•Education andtraining•Allocative efficiency•OtherREALGDPSUPPLY DETERMINANTSOF REAL OUTPUTLaborInputs(Hoursof Work)LaborProductivity(AverageOutputPer Hour)X =
    • 17 - 7Copyright McGraw-Hill/Irwin, 2002Growth EconomicsProduction Possibilities AnalysisSupply Determinants of Real OutputGrowth in the AD-AS ModelU.S. EconomicGrowth RatesAccounting forGrowthProductivity Growthin the New EconomyKey TermsPreviousSlideNextSlideEndShowGROWTH IN THE AD-AS MODELProduction Possibilities andAggregate SupplyExtending the AD-ASModel
    • 17 - 8Copyright McGraw-Hill/Irwin, 2002Growth EconomicsProduction Possibilities AnalysisSupply Determinants of Real OutputGrowth in the AD-AS ModelU.S. EconomicGrowth RatesAccounting forGrowthProductivity Growthin the New EconomyKey TermsPreviousSlideNextSlideEndShowGROWTH IN THE AD-AS MODELABCDCapitalGoodsConsumer GoodsPriceLevelReal GDPASLR1 ASLR2Q1 Q2
    • 17 - 9Copyright McGraw-Hill/Irwin, 2002Growth EconomicsProduction Possibilities AnalysisSupply Determinants of Real OutputGrowth in the AD-AS ModelU.S. EconomicGrowth RatesAccounting forGrowthProductivity Growthin the New EconomyKey TermsPreviousSlideNextSlideEndShowECONOMIC GROWTH IN THEEXTENDED AD – AS MODELPriceLevelReal GDPoP1AS2ASLR1AD2Q1ASLR2Q2AD1AS1P2
    • 17 - 10Copyright McGraw-Hill/Irwin, 2002Growth EconomicsProduction Possibilities AnalysisSupply Determinants of Real OutputGrowth in the AD-AS ModelU.S. EconomicGrowth RatesAccounting forGrowthProductivity Growthin the New EconomyKey TermsPreviousSlideNextSlideEndShowU.S. Economic Growth,Annual Averages for Five Decades1950-1959 1960-1969 1970-1979 1980-1989 1990-1999U.S. ECONOMIC GROWTH RATES543210Real GDP Real GDP Per CapitaAverageAnnualIncrease(Percent)
    • 17 - 11Copyright McGraw-Hill/Irwin, 2002Growth EconomicsProduction Possibilities AnalysisSupply Determinants of Real OutputGrowth in the AD-AS ModelU.S. EconomicGrowth RatesAccounting forGrowthProductivity Growthin the New EconomyKey TermsPreviousSlideNextSlideEndShowACCOUNTING FOR GROWTHInputs versus ProductivityQuantity of LaborTechnological AdvanceQuantity of CapitalInfrastructureEducation and TrainingHuman Capital
    • 17 - 12Copyright McGraw-Hill/Irwin, 2002Growth EconomicsProduction Possibilities AnalysisSupply Determinants of Real OutputGrowth in the AD-AS ModelU.S. EconomicGrowth RatesAccounting forGrowthProductivity Growthin the New EconomyKey TermsPreviousSlideNextSlideEndShowACCOUNTING FOR GROWTHIncrease in quantity of labor 33%Increase in labor productivity 67%Technological advance 26%Quantity of capital 18%Education and training 11%Economies of scale 6%Improved resourceallocation 6%100%Sources of Growth of U.S. Output, 1929-2000
    • 17 - 13Copyright McGraw-Hill/Irwin, 2002Growth EconomicsProduction Possibilities AnalysisSupply Determinants of Real OutputGrowth in the AD-AS ModelU.S. EconomicGrowth RatesAccounting forGrowthProductivity Growthin the New EconomyKey TermsPreviousSlideNextSlideEndShowChanges in the Educational Attainmentof the U.S. Adult Population1950 1960 1970 1980 1990 2000100806040200College Graduates or More High School Graduates or MoreACCOUNTING FOR GROWTHSource: U.S. Census BureauPercentofU.S.Population
    • 17 - 14Copyright McGraw-Hill/Irwin, 2002Growth EconomicsProduction Possibilities AnalysisSupply Determinants of Real OutputGrowth in the AD-AS ModelU.S. EconomicGrowth RatesAccounting forGrowthProductivity Growthin the New EconomyKey TermsPreviousSlideNextSlideEndShowACCOUNTING FOR GROWTHEconomies of ScaleImproved ResourceAllocationOther Factors
    • 17 - 15Copyright McGraw-Hill/Irwin, 2002Growth EconomicsProduction Possibilities AnalysisSupply Determinants of Real OutputGrowth in the AD-AS ModelU.S. EconomicGrowth RatesAccounting forGrowthProductivity Growthin the New EconomyKey TermsPreviousSlideNextSlideEndShowPRODUCTIVITY GROWTHAND THE NEW ECONOMYCharacteristics of the NewEconomy•Microchip andInformation Technology•New Firms andIncreasing Returns•Start-Up Firms
    • 17 - 16Copyright McGraw-Hill/Irwin, 2002Growth EconomicsProduction Possibilities AnalysisSupply Determinants of Real OutputGrowth in the AD-AS ModelU.S. EconomicGrowth RatesAccounting forGrowthProductivity Growthin the New EconomyKey TermsPreviousSlideNextSlideEndShowPRODUCTIVITY GROWTHAND THE NEW ECONOMYSources of Increasing Returns• More Specialized Inputs• Spreading of DevelopmentCosts• Simultaneous Consumption• Network Effects• Learning by DoingGlobal Competition
    • 17 - 17Copyright McGraw-Hill/Irwin, 2002Growth EconomicsProduction Possibilities AnalysisSupply Determinants of Real OutputGrowth in the AD-AS ModelU.S. EconomicGrowth RatesAccounting forGrowthProductivity Growthin the New EconomyKey TermsPreviousSlideNextSlideEndShowPRODUCTIVITY GROWTHAND THE NEW ECONOMYMacroeconomic Implications• Faster NoninflationaryGrowth• Low Natural Rate ofUnemployment• Growing Tax RevenuesSkepticism About the NewEconomy
    • 17 - 18Copyright McGraw-Hill/Irwin, 2002Growth EconomicsProduction Possibilities AnalysisSupply Determinants of Real OutputGrowth in the AD-AS ModelU.S. EconomicGrowth RatesAccounting forGrowthProductivity Growthin the New EconomyKey TermsPreviousSlideNextSlideEndShowGLOBAL PERSPECTIVEGrowth Competitiveness Ranking 2000Source: World Economic Forum12345678910United StatesSingaporeLuxembourgNetherlandsIrelandFinlandCanadaHong Kong, ChinaUnited KingdomSwitzerlandRank
    • 17 - 19Copyright McGraw-Hill/Irwin, 2002Growth EconomicsProduction Possibilities AnalysisSupply Determinants of Real OutputGrowth in the AD-AS ModelU.S. EconomicGrowth RatesAccounting forGrowthProductivity Growthin the New EconomyKey TermsPreviousSlideNextSlideEndShowIS GROWTH DESIRABLEAND SUSTAINABLE?The Antigrowth ViewIn Defense ofEconomic GrowthChapter Conclusions
    • economic growthsupply factorsdemand factorefficiency factorlabor productivitylabor-force participationrateinfrastructurehuman capitaleconomies of scaleNew Economyinformation technologystart-up firmsincreasing returnsnetwork effectslearning by doingENDBACKCopyright McGraw-Hill/Irwin 2002
    • 17 - 21Copyright McGraw-Hill/Irwin, 2002Growth EconomicsProduction Possibilities AnalysisSupply Determinants of Real OutputGrowth in the AD-AS ModelU.S. EconomicGrowth RatesAccounting forGrowthProductivity Growthin the New EconomyKey TermsPreviousSlideNextSlideEndShowDeficits,Surplusesand thePublic DebtChapter 18 Next...