| capital-labor ratio | The amount of capital available for use by each worker; the capital stock divided by the labor supply.
|
 |
|
|
| cobb-Douglas production function | Production function with constant returns to scale,
constant elasticity of output, and unit elasticity of substitution between input factors.
|
|
|
|
| convergence | See conditional and absolute convergence.
|
|
|
|
| diminishing marginal product | A characteristic of a production function whereby the
marginal product of a factor falls as the amount of the factor increases while all other factors are held constant.
|
|
|
|
| GDP per capita | GDP per person.
|
|
|
|
| golden-rule capital stock | The steady-state level of capital that provides the most
consumption each period. When the capital stock is at the golden-rule level, the marginal product of capital is equal to the rate of depreciation plus the rate of population growth (and, when there is growth in technology, the rate of technological progress).
|
|
|
|
| growth accounting | The theory of measurement of the sources of economic growth.
|
|
|
|
| growth accounting equation | The equation that summarizes the relationship between
input growth and output growth.
|
|
|
|
| growth theory | Tries to explain why output grows over time and to identify the factors that affect its growth rate.
|
|
|
|
| human capital | Education and training of individuals to increase productivity.
|
|
|
|
| marginal product of capital (MPK) | Increment to output obtained by adding one unit of capital, with other factor inputs held constant.
|
|
|
|
| marginal product of labor (MPL) | Increment to output obtained by adding one unit of labor, with other factor inputs held constant.
|
|
|
|
| neoclassical growth theory | Theory that asserts that the growth rate of output is determined by exogenous technological growth.
|
|
|
|
| production function | Technological relation showing how much output can be
produced for a given combination of inputs.
|
|
|
|
| Solow residual | A measure of total factor productivity; change in the level of production that cannot be accounted for by changes in factor inputs.
|
|
|
|
| steady-state equilibrium | State in which real (per capita) economic variables are
constant.
|
|
|
|
| total factor productivity | Rate at which productivity of inputs increases; measure of
technological progress. See also Solow residual.
|