Suppose the economy is on a balanced growth path in the Romer model, and then, in the

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Suppose the economy is on a balanced growth path in the Romer model, and then, in the year 2030, research productivity  rises immediately and permanently to the new level ʹ.
(a) Solve for the new growth rate of knowledge and yt.
(b) Make a graph of yt over time using a ratio scale.
(c) Why might research productivity increase in an economy?
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Macroeconomics

ISBN: 978-0393923902

3rd edition

Authors: Charles I. Jones

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