Exam 12: Production and Growth: Part B

Countries with high population growth rates tend to have lower levels of educational attainment.

The same size decrease in the amount of capital stock per worker will cause output per worker to fall by more in a country with a relatively high level of capital per worker than in a country with a relatively low level of capital per worker.

Human capital is the term economists use to refer to the knowledge and skills that workers acquire through education,training,and experience.

Economists generally believe that inward-oriented policies are more likely to foster growth than outward-oriented policies.

If a production function has constant returns to scale,then if all inputs double so does production.

Other things the same,an economy's factors of production are likely to be used more effectively if there is an economywide respect for property rights.

Studies confirm that controlling for other variables such as the percentage of GDP devoted to investment,poor countries tend to grow at a faster rate than rich countries.

Over the period 1890-2014,Japan experienced a 2.59 percent average annual growth rate of real GDP per person.

If per capita real income grows by 2 percent per year,then it will double in approximately 20 years.

The majority of economists believe that future innovations will not be transformational enough to sustain high economic growth rates in the U.S.and western Europe.

When Americans invest in Russia,the income of Russians (that is,Russian GNP)rises by more than production in Russia (that is,Russian GDP).

Although growth rates across countries vary some,rankings of countries by income remain pretty much the same over time.

An increase in a country's saving rate permanently raises its productivity.

In 2014 income per person in the United States was about 10 times that in India.

Without controlling for differences in natural resources and technological knowledge,diminishing returns can explain the entire difference in economic growth rates for China and the United States.

According to some estimates,over the last two decades China has had an annual average growth rate of about 12 percent.

Productivity can be computed as the number of hours worked divided by output.

If a country has a higher level of productivity than another,then it also has a higher level of real GDP.

As capital per worker rises,output per worker rises.However,this increase in output per worker is smaller at smaller levels of existing capital per worker.

Historical trends in the prices of most natural resources compared to prices of other goods indicate that most natural resources have become scarcer over time.