An expansion of production function is to separate workers based on thein quality as below. Y...

 

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An expansion of production function is to separate workers based on thein quality as below. Y = z(K+ 15000Lu)0.6 LO4, where Y is output, z is TFP, K capital, Lu unskilled labor and Ls skilled labor. The expression for the marginal product of skilled and unskilled labor are given below: MPL = 0.6 · z(K+15000Lu)-0.4L04. 15000 MPL, = 0.4 z(K + 15000L).° -0.6 %3D In this production function capital and skilled labor complement each other, while capital and unskilled labor are substitutes. The picture you can have is that a trained operator using a bulldozer replacing a group of brawny man with shovels. (a) In year 1990, z = 500, K = 30000, L, = 1, Lu = 1. Calculate the marginal product %3D of each labor type. (b) In year 2010, z = of each labor type. 700, K = 65000, Ls = 1, Lu = 1. Calculate the marginal product %3D (c) Calculate the accumulated percentage increase of marginal product for each type of labor during this 20 year period. An expansion of production function is to separate workers based on thein quality as below. Y = z(K+ 15000Lu)0.6 LO4, where Y is output, z is TFP, K capital, Lu unskilled labor and Ls skilled labor. The expression for the marginal product of skilled and unskilled labor are given below: MPL = 0.6 · z(K+15000Lu)-0.4L04. 15000 MPL, = 0.4 z(K + 15000L).° -0.6 %3D In this production function capital and skilled labor complement each other, while capital and unskilled labor are substitutes. The picture you can have is that a trained operator using a bulldozer replacing a group of brawny man with shovels. (a) In year 1990, z = 500, K = 30000, L, = 1, Lu = 1. Calculate the marginal product %3D of each labor type. (b) In year 2010, z = of each labor type. 700, K = 65000, Ls = 1, Lu = 1. Calculate the marginal product %3D (c) Calculate the accumulated percentage increase of marginal product for each type of labor during this 20 year period.

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a in the year 1990 marginal product of skilled and unskilled labour MPLS 04 500300001... View the full answer