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28.2 Growth from Increasing I/Y

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Jul 14, 2023
5:45

In this video, we explore how increasing the GDP share of investment in the economy leads to a higher level of steady state capital and therefore a higher level of the long run (natural) level of GDP. But we note that there is a limit to the share of GDP that can be devoted to investment, and thus raising the GDP share of investment can ultimately not sustain ongoing long run economic growth. Raising labor hours (through immigration or increases in fertility) or natural resources (through finding more natural resources) runs into similar limits.

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28.2 Growth from Increasing I/Y | NatokHD