Effective Capital in Upgraded Solow Macro-Model of Economic Growth
The article studies the macro-economic theory of economic growth Solow in complicated case, when technical progress is materialized in capital. In this situation the production function depends on effective capital and labour resource. The authors research in detail the efficiency of capital. As a r...
| Main Authors: | , |
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| Format: | Article |
| Language: | Russian |
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Plekhanov Russian University of Economics
2022-07-01
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| Series: | Вестник Российского экономического университета имени Г. В. Плеханова |
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| Online Access: | https://vest.rea.ru/jour/article/view/1379 |
| Summary: | The article studies the macro-economic theory of economic growth Solow in complicated case, when technical progress is materialized in capital. In this situation the production function depends on effective capital and labour resource. The authors research in detail the efficiency of capital. As a rule differential equation of balance for the capital is deduced on the basis of the principle economic identity: profit, i. e. output of industrial products is equal to the sum total of consumption and investment. On the basis of ordinary differential equation of balance for the capital it is possible to obtain the ordinary differential equation for capital-labour ratio. The rates of capital efficiency growth, labour reserve, norms of accumulation and rates of capital amortization are set exogenously. The research shows that this equation differs seriously from similar ordinary differential equation for capital-labour ratio in case technical progress is materialized in labour. |
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| ISSN: | 2413-2829 2587-9251 |