What's it: Total factor productivity quantifies the share of economic growth not explained by increases in labor and capital when both are used together in the production process. We also often refer to it as the residual Solow model or multifactor
Long Run Economic Growth
Capital Deepening: Boosting Productivity [Definition, Determinants, and Impacts]
What's it? Capital deepening is an investment in increasing the capital-to-labor ratio. It is one way to encourage economic growth and increase potential output in the long run.Assuming the supply of labor (as measured by the labor force) does
Harrod-Domar Model: Growth from Saving and Investment [Assumptions, Importance, Limitations]
What’s it: The Harrod-Domar model is an economic growth model that uses saving and investment as growth sources. The model takes two economists, Sir Roy Harrod and Evsey Domar, who independently developed the model in 1939 and 1946.The
Solow Growth Model: Understanding Long-Term Economic Growth
The Solow Growth Model, a cornerstone of economic theory, sheds light on the long-term forces that drive a nation's economic prosperity. Developed by Robert Solow, this model explores how factors like capital investment, labor growth, and