Question: Would love some help on this :) In the Solow model, we have production given by Y = AKL1-a where A is a measure of

Would love some help on this :)

Would love some help on this :) In the Solow model, wehave production given by Y = AKL1-a where A is a measure

In the Solow model, we have production given by Y = AKL1-a where A is a measure of productivity, Fis output, Kis capital, _ is labour and a is the capital share of income. (a) Assuming a = 1/3, L = 200 and A=2, draw a plot of output as a function of capita as capital varies between 0 and 4000 in steps of 40. [Hint: Use Excel, Python or R]. (b ) Assume the savings rate is 25 percent and the depreciation rate is 10 percent, draw the savings as a function of capital and the amount of deprecation as a function of capital. This is a version of the Solow diagram seen in Figure 11.2 of Blanchard. Calculate the steady-date level of output worker. (c) Draw a third diagram to show the impact of savings rate increasing to 35 percent. Calculate the new steady state level of output per worker. (d) How does the savings rate affect the growth rate of output per worker?Figure 11-2 Depreciation per worker Capital and Output 6K /N Dynamics When capital and output are -Output per worker low, investment exceeds f(K /N) depreciation and capital in- YIN creases. When capital and output are high, investment B Investment per worker is less than depreciation and sf(K /N) capital decreases. C MyEconLab Animation Output per worker, Y/N iA (Ky/N Capital per worker, K/N

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