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How do we measure long-term economic growth of a country

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Reference no: EM131497779

Assignemnt: Long Term Economic Growth

The Discussion topics focus on the long term economic growth, and the specific discussion areas measuring economic growth, natural resources and economic growth, the role of government and the roles of saving, investment and financial system in economic growth.

Respond to two of the following Discussion topics.

Topic 1: The long-run growth is measured as the increase in real GDP per capita and this measure has changed over time and it also varies across countries. A country's standard of living depends on its ability to produce goods and services (productivity).

a. How do we measure long-term economic growth of a country? What are the key determinants of long-run economic growth?

b. What is the relationship between economic growth and productivity? What is the major source of growth in labor productivity?

Topic 2: There are different types of financial intermediaries with different roles in the economy. Savings and investment spending are interdependent, and interest rates are determined in the loanable funds market.

a. What are the roles of financial intermediaries and loanable funds market in promoting long-run economic growth? How do financial intermediaries link saving and investment?

b. How does government borrowing crowd out investment? What is the relationship between government borrowing and budget deficits?

Reference no: EM131497779

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