Question: Production function Y=zK 1/2 (HN) 1/2 , where H is the human capital stock. Solve the model starting from the law of motion for K
Production function Y=zK1/2(HN)1/2, where H is the human capital stock. Solve the model starting from the law of motion for K and find the equation that describes the equilibrium output per efficiency unit of labor (y tilde = Y/HN). Notice that the growth rate of human capital is given by H'/H - 1 = f
let n is the population growth rate, d is the depreciation rate, s is the saving rate, z is the TFP
Step by Step Solution
There are 3 Steps involved in it
1 Expert Approved Answer
Step: 1 Unlock
Question Has Been Solved by an Expert!
Get step-by-step solutions from verified subject matter experts
Step: 2 Unlock
Step: 3 Unlock
