Suppose you have the following information about an economy: Average annual rates of growth from 2002...

 
 

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Suppose you have the following information about an economy: Average annual rates of growth from 2002 to 2012: Potential GDP 3.97% Labour Force 1.2% Capital Stock 0.9% Share of labour income in national income: 2/3 Using growth accounting, find the contributions to the annual growth in potential GDP that came from: Note: Make sure your answers are in percentage form and rounded to two decimal places. a) Growth in labour force? Contribution from growth in labour force = 0 % b) Growth in capital stock? Contribution from growth in capital stock = 0 % c) Improved productivity as measured by the Solow residual? Contribution from improved productivity = 0 % Suppose you have the following information about an economy: Average annual rates of growth from 2002 to 2012: Potential GDP 3.97% Labour Force 1.2% Capital Stock 0.9% Share of labour income in national income: 2/3 Using growth accounting, find the contributions to the annual growth in potential GDP that came from: Note: Make sure your answers are in percentage form and rounded to two decimal places. a) Growth in labour force? Contribution from growth in labour force = 0 % b) Growth in capital stock? Contribution from growth in capital stock = 0 % c) Improved productivity as measured by the Solow residual? Contribution from improved productivity = 0 %

Answer rating: 100% (QA)

Solution A Contribution from labor Labor share growth ... View the full answer