Question: In the Solow growth model without population growth, consider two economies, Alezia and Gardenia, that are identical ( having the same saving rate, production function
In the Solow growth model without population growth, consider two economies, Alezia and Gardenia, that are identical having the same saving rate, production function and rate of depreciation except that the initial level of capital per worker is higher in Alezia than in Gardenia. Then the steadystate level of income per worker in Gardenia will be
at the same level as the steady state of Alezia.
at a higher level than the steady state of Alezia.
at a lower level than the steady state of Alezia.
proportional to the ratio of the capital stocks in the two economies.
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