A Farewell to Alms: A Brief Economic History of the World by Gregory Clark

Author:Gregory Clark [Clark, Gregory]
Language: eng
Format: epub, pdf
ISBN: 9781400827817
Publisher: Princeton University Press
Published: 2008-12-29T00:00:00+00:00

Figure 10.4, for example, shows for a group of OECD countries at different income levels their efficiency growth rates from 1960 to 2000 com-pared to their capital growth rates per worker. Even though capital stocks are notoriously difficult to measure, the correlation between capital growth and efficiency growth is close.

When two variables are so closely correlated one must cause the other.9 The growth in efficiency must also be driving up the stock of capital per worker. The process through which this occurs is shown in figure 10.5.

The lower curve in the figure shows the output in an economy of given efficiency level as a function of the stock of physical capital employed per worker, k. Adding more capital always increases output, but at a smaller and smaller rate as the capital stock per worker increases. Investors will expand the stock of capital to the point k0 where the net additional output created from

Download

Copyright Disclaimer:
This site does not store any files on its server. We only index and link to content provided by other sites. Please contact the content providers to delete copyright contents if any and email us, we'll remove relevant links or contents immediately.