Introduction to Economic Growth

Introduction to Economic Growth tài liệu, giáo án, bài giảng , luận văn, luận án, đồ án, bài tập lớn về tất cả các lĩnh...

1 FINANCIAL LIBERALISATION AND THE RELATIONSHIP BETWEEN FINANCE AND GROWTH Philip Arestis University of Cambridge CEPP WORKING PAPER NO. 05/05 June 2005 Department of Land Economy 19 Silver Street Cambridge CB3 9EP Telephone: 01223 337147 UNIVERSITY OF CAMBRIDGE Centre for Economic and Public Policy 2 Introduction1 The relationship between financial development and economic growth has received a great deal of attention throughout the modern history of economics. Its roots can be traced in Lydia of Asia Minor where the first money was in evidence. The first signs of public debate, however, on the relationship between finance and growth, and indeed on experiments with free banking, can be located in Rome in the year 33 AD. In that year there was probably the first classic case of public panic and run on the banks. The Romans debated intensely and fiercely at that time the possibility of placing a hitherto free banking system under the control of the government. Since then, of course, a great number of economists have dealt with the issue. An early and intellectual development came from Bagehot (1873), in his classic Lombard Street, where he emphasised the critical importance of the banking system in economic growth and highlighted circumstances when banks could actively spur innovation and future growth by identifying and funding productive investments. The work of Schumpeter (1911) should also be mentioned. He argued that financial services are paramount in promoting economic growth. In this view production requires credit to materialise, and one "can only become an entrepreneur by previously becoming a debtor .What [the entrepreneur] first wants is credit. Before he requires any goods whatever, he requires purchasing power. He is the typical debtor in capitalist society" (p. 102). In this process, the banker is the key agent. Schumpeter (1911) is very explicit on this score: "The banker, therefore, is not so much primarily the middleman in the commodity `purchasing power' as a producer of this commodity . He is the ephor of the exchange economy" (p. 74). Keynes (1930), in his A Treatise on Money, also argued for the importance of the banking sector in economic growth. He suggested that bank credit "is the pavement along which production travels, and the bankers if they knew their duty, would provide the transport facilities to just the extent that is required in order that the productive powers of the community can be employed at their full capacity" (II, p. 220). In the same spirit Robinson (1952) argued that financial development follows growth, and articulated this causality argument by suggesting that "where enterprise leads finance follows" (p. 86). Both, however, recognized this as a function of current institutional structure, which is not necessarily given. In fact, Keynes (1936) later supported an alternative structure that included direct government control of investment. Although growth may be constrained by credit creation in less developed financial systems, in more sophisticated systems finance is viewed as endogenous responding to demand requirements. This line of Introduction to Economic Growth Introduction to Economic Growth By: OpenStaxCollege Average Daily Calorie Consumption Not only has the number of calories consumer per day increased, so has the amount of food calories that people are able to afford based on their working wages (Credit: modification of work by Lauren Manning/Flickr Creative Commons) Calories and Economic Growth On average, humans need about 2,500 calories a day to survive, depending on height, weight, and gender The economist Brad DeLong estimates that the average worker in the early 1600s earned wages that could afford him 2,500 food calories This worker lived in Western Europe Two hundred years later, that same worker could afford 3,000 food calories However, between 1800 and 1875, just a time span of just 75 years, 1/3 Introduction to Economic Growth economic growth was so rapid that western European workers could purchase 5,000 food calories a day By 2012, a low skilled worker in an affluent Western European/ North American country could afford to purchase 2.4 million food calories per day What caused such a rapid rise in living standards between 1800 and 1875 and thereafter? Why is it that many countries, especially those in Western Europe, North America, and parts of East Asia, can feed their populations more than adequately, while others cannot? We will look at these and other questions as we examine long-run economic growth Introduction to Economic Growth In this chapter, you will learn about: • • • • The Relatively Recent Arrival of Economic Growth Labor Productivity and Economic Growth Components of Economic Growth Economic Convergence Every country worries about economic growth In the United States and other highincome countries, the question is whether economic growth continues to provide the same remarkable gains in our standard of living as it did during the twentieth century Meanwhile, can middle-income countries like South Korea, Brazil, Egypt, or Poland catch up to the higher-income countries? Or must they remain in the second tier of per capita income? Of the world’s population of roughly 6.7 billion people, about 2.6 billion are scraping by on incomes that average less than $2 per day, not that different from the standard of living 2,000 years ago Can the world’s poor be lifted from their fearful poverty? As the 1995 Nobel laureate in economics, Robert E Lucas Jr., once noted: “The consequences for human welfare involved in questions like these are simply staggering: Once one starts to think about them, it is hard to think about anything else.” Dramatic improvements in a nation’s standard of living are possible After the Korean War in the late 1950s, the Republic of Korea, often called South Korea, was one of the poorest economies in the world Most South Koreans worked in peasant agriculture According to the British economist Angus Maddison, whose life’s work was the measurement of GDP and population in the world economy, GDP per capita in 1990 international dollars was $854 per year From the 1960s to the early twenty-first century, a time period well within the lifetime and memory of many adults, the South Korean economy grew rapidly Over these four decades, GDP per capita increased by more than 6% per year According to the World Bank, GDP for South Korea now exceeds $30,000 in nominal terms, placing it firmly among high-income countries like Italy, New Zealand, and Israel Measured by total GDP in 2012, South Korea is the thirteenthlargest economy in the world For a nation of 49 million people, this transformation is extraordinary 2/3 Introduction to Economic Growth South Korea is a standout example, but it is not the only case of rapid and sustained economic growth Other nations of East Asia, like Thailand and Indonesia, have seen very rapid growth as well China has grown enormously since market-oriented economic reforms were enacted around 1980 GDP per capita in high-income economies like the United States also has grown dramatically albeit over a longer time frame Since the Civil War, the U.S economy has been transformed from a primarily rural and agricultural economy to an economy based on services, manufacturing, and technology 3/3 Introduction to Economic Analysis McAfee: Introduction to Economic Analysis, http://www.introecon.com, July 24, 2006 i Introduction to Economic Analysis by R. Preston McAfee J. Stanley Johnson Professor of Business, Economics & Management California Institute of Technology x y Initial Choice p Y ↑ Compensated Choice q A * Tax p q D Before Tax S Before Tax q B * Tax Revenue Dead Weight Loss 0.1 0.2 0.3 0.4 -0.04 -0.02 0.02 S & S Stable Equilibrium Unstable Equilibrium 1 2 McAfee: Introduction to Economic Analysis, http://www.introecon.com, July 24, 2006 ii Dedication to this edition: For Sophie. Perhaps by the time she goes to university, we’ll have won the war against the publishers. Disclaimer: This is the third draft. Please point out typos, errors or poor exposition, preferably by email to intro@mcafee.cc. Your assistance matters. In preparing this manuscript, I have received assistance from many people, including Michael Bernstein, Steve Bisset, Grant Chang-Chien, Lauren Feiler, Alex Fogel, Ben Golub, George Hines, Richard Jones, Jorge Martínez, Joshua Moses, Dr. John Ryan, and Wei Eileen Xie. I am especially indebted to Anthony B. Williams for a careful, detailed reading of the manuscript yielding hundreds of improvements. McAfee: Introduction to Economic Analysis, http://www.introecon.com, July 24, 2006 iii Introduction to Economic Analysis Version 2.0 by R. Preston McAfee J. Stanley Johnson Professor of Business, Economics & Management California Institute of Technology Begun: June 24, 2004 This Draft: July 24, 2006 This book presents introductory economics (“principles”) material using standard mathematical tools, including calculus. It is designed for a relatively sophisticated undergraduate who has not taken a basic university course in economics. It also contains the standard intermediate microeconomics material and some material that ought to be standard but is not. The book can easily serve as an intermediate microeconomics text. The focus of this book is on the conceptual tools and not on fluff. Most microeconomics texts are mostly fluff and the fluff market is exceedingly over- served by $100+ texts. In contrast, this book reflects the approach actually adopted by the majority of economists for understanding economic activity. There are lots of models and equations and no pictures of economists. This work is licensed under the Creative Commons Attribution- NonCommercial-ShareAlike License. To view a copy of this license, visit http://creativecommons.org/licenses/by-nc-sa/2.0/ or send a letter to Creative Commons, 559 Nathan Abbott Way, Stanford, California 94305, USA. Please email changes to intro@mcafee.cc. McAfee: Introduction to Economic Analysis, http://www.introecon.com, July 24, 2006 iv Table of Contents 1 WHAT IS ECONOMICS? 1-1 1.1.1 Normative and Positive Theories 1-2 1.1.2 Opportunity Cost 1-3 1.1.3 Economic Reasoning and Analysis 1-5 2 SUPPLY AND DEMAND 2-8 2.1 Supply and Demand 2-8 2.1.1 Demand and Consumer Surplus 2-8 2.1.2 Supply 2-13 2.2 The Market 2-18 2.2.1 Market Demand and Supply 2-18 2.2.2 Equilibrium 2-20 2.2.3 Efficiency of Equilibrium 2-22 2.3 Changes in Supply and Demand 2-22 2.3.1 Changes in Demand 2-22 2.3.2 Changes in Supply 2-23 2.4 Elasticities 2-27 2.4.1 Elasticity of Demand 2-27 2.4.2 Elasticity of Supply 2-30 2.5 Comparative Statics 2-30 2.5.1 Supply and Demand Changes 2-30 2.6 Trade 2-32 2.6.1 Production Possibilities Frontier 2-32 2.6.2 Comparative and Absolute Advantage 2-36 2.6.3 Factors and Production 2-38 2.6.4 International Trade 2-39 3 THE US ECONOMY 3-41 3.1.1 Basic [...]... them N Arndt and C Ganino, Metals and Society: an Introduction to Economic Geology, DOI 10.1007/978-3-642-22996-1_2, # Springer-Verlag Berlin Heidelberg 2012 19 20 2 Classification, Distribution and Uses of Ores and Ore Deposits Table 2.1 Metals, useful minerals and their ores Class Element Mineral Ferrous metals Iron (Fe) Manganese (Mn) Chromium (Cr) Nickel (Ni) Aluminium Base metals Precious metals Molybdinum(Mo)... rose sharply to about $9,000 per ton Over the same period, the total amount of copper mined gradually increased, except in the early 1920s and 1930s when both price and production dropped Figure 1.2 shows that other metals followed similar trends How do we explain these changes, and what do they tell us about how the metal is found and mined, and about how it is used by society? Understanding these... Arndt and C Ganino, Metals and Society: an Introduction to Economic Geology, DOI 10.1007/978-3-642-22996-1_1, # Springer-Verlag Berlin Heidelberg 2012 1 2 1 Introduction 18 Production (x 100000 tonnes/yr) Grade (%) Recession 8 Depression 10 War 12 Recession Post-war growth 14 China effect Price ($US/tonne(/100) 16 War 6 4 2 0 1900 1920 1940 1960 1980 2000 Year Fig 1.1 Evolution in the price and production... operation To be able to follow such a discussion requires at least a basic knowledge of the commercial aspects of mining operations and of world trade in mineral products Our aim in this book is to provide basic information about the scientific issues related to the nature and origin of ore deposits, to explain how, where and why metals and mineral products are used in our modern society, and to illustrate... ideas lead us to examine several notions and definitions that are fundamental to economic geology Box 1.1 Consider the Following Statements and Discuss What They Tell Us About Economic Geology and the Mining Industry, as Perceived by the General Public 1 In the 1990s a Japanese scientist developed a new type of catalytic converter in which manganese replaced platinum Why is this discovery important? 2 English... well taken into account by Meadows and co-authors is the impact of improvements in technology, which has allowed even low-grade deposits to be mined efficiently, and the metals and other mineral products to be extracted economically Later chapters provide striking examples of the evolution of mining and extraction technologies A fundamental difference between the long-term production of metals and energy... Supply risk What Is an Ore Deposit? An ore deposit is defined as an accumulation of a useful commodity that is present in high-enough concentration and in sufficient quantity to be extractable at a profit In this definition as well we find the terms useful commodity and profit: the definition is both McAfee: Introduction to Economic Analysis, http://www.introecon.com, July 24, 2006 i Introduction to Economic Analysis by R. Preston McAfee J. Stanley Johnson Professor of Business, Economics & Management California Institute of Technology x y Initial Choice p Y ↑ Compensated Choice q A * Tax p q D Before Tax S Before Tax q B * Tax Revenue Dead Weight Loss 0.1 0.2 0.3 0.4 -0.04 -0.02 0.02 S & S Stable Equilibrium Unstable Equilibrium 1 2 McAfee: Introduction to Economic Analysis, http://www.introecon.com, July 24, 2006 ii Dedication to this edition: For Sophie. Perhaps by the time she goes to university, we’ll have won the war against the publishers. Disclaimer: This is the third draft. Please point out typos, errors or poor exposition, preferably by email to intro@mcafee.cc. Your assistance matters. In preparing this manuscript, I have received assistance from many people, including Michael Bernstein, Steve Bisset, Grant Chang-Chien, Lauren Feiler, Alex Fogel, Ben Golub, George Hines, Richard Jones, Jorge Martínez, Joshua Moses, Dr. John Ryan, and Wei Eileen Xie. I am especially indebted to Anthony B. Williams for a careful, detailed reading of the manuscript yielding hundreds of improvements. McAfee: Introduction to Economic Analysis, http://www.introecon.com, July 24, 2006 iii Introduction to Economic Analysis Version 2.0 by R. Preston McAfee J. Stanley Johnson Professor of Business, Economics & Management California Institute of Technology Begun: June 24, 2004 This Draft: July 24, 2006 This book presents introductory economics (“principles”) material using standard mathematical tools, including calculus. It is designed for a relatively sophisticated undergraduate who has not taken a basic university course in economics. It also contains the standard intermediate microeconomics material and some material that ought to be standard but is not. The book can easily serve as an intermediate microeconomics text. The focus of this book is on the conceptual tools and not on fluff. Most microeconomics texts are mostly fluff and the fluff market is exceedingly over- served by $100+ texts. In contrast, this book reflects the approach actually adopted by the majority of economists for understanding economic activity. There are lots of models and equations and no pictures of economists. This work is licensed under the Creative Commons Attribution- NonCommercial-ShareAlike License. To view a copy of this license, visit http://creativecommons.org/licenses/by-nc-sa/2.0/ or send a letter to Creative Commons, 559 Nathan Abbott Way, Stanford, California 94305, USA. Please email changes to intro@mcafee.cc. McAfee: Introduction to Economic Analysis, http://www.introecon.com, July 24, 2006 iv Table of Contents 1 WHAT IS ECONOMICS? 1-1 1.1.1 Normative and Positive Theories 1-2 1.1.2 Opportunity Cost 1-3 1.1.3 Economic Reasoning and Analysis 1-5 2 SUPPLY AND DEMAND 2-8 2.1 Supply and Demand 2-8 2.1.1 Demand and Consumer Surplus 2-8 2.1.2 Supply 2-13 2.2 The Market 2-18 2.2.1 Market Demand and Supply 2-18 2.2.2 Equilibrium 2-20 2.2.3 Efficiency of Equilibrium 2-22 2.3 Changes in Supply and Demand 2-22 2.3.1 Changes in Demand 2-22 2.3.2 Changes in Supply 2-23 2.4 Elasticities 2-27 2.4.1 Elasticity of Demand 2-27 2.4.2 Elasticity of Supply 2-30 2.5 Comparative Statics 2-30 2.5.1 Supply and Demand Changes 2-30 2.6 Trade 2-32 2.6.1 Production Possibilities Frontier 2-32 2.6.2 Comparative and Absolute Advantage 2-36 2.6.3 Factors and Production 2-38 2.6.4 International Trade 2-39 3 THE US ECONOMY 3-41 3.1.1 Basic Demographics 3-41 McAfee: Introduction to Economic Analysis, http://www.introecon.com, July 24, 2006 i Introduction to Economic Analysis by R. Preston McAfee J. Stanley Johnson Professor of Business, Economics & Management California Institute of Technology x y Initial Choice p Y ↑ Compensated Choice q A * Tax p q D Before Tax S Before Tax q B * Tax Revenue Dead Weight Loss 0.1 0.2 0.3 0.4 -0.04 -0.02 0.02 S & S Stable Equilibrium Unstable Equilibrium 1 2 McAfee: Introduction to Economic Analysis, http://www.introecon.com, July 24, 2006 ii Dedication to this edition: For Sophie. Perhaps by the time she goes to university, we’ll have won the war against the publishers. Disclaimer: This is the third draft. Please point out typos, errors or poor exposition, preferably by email to intro@mcafee.cc. Your assistance matters. In preparing this manuscript, I have received assistance from many people, including Michael Bernstein, Steve Bisset, Grant Chang-Chien, Lauren Feiler, Alex Fogel, Ben Golub, George Hines, Richard Jones, Jorge Martínez, Joshua Moses, Dr. John Ryan, and Wei Eileen Xie. I am especially indebted to Anthony B. Williams for a careful, detailed reading of the manuscript yielding hundreds of improvements. McAfee: Introduction to Economic Analysis, http://www.introecon.com, July 24, 2006 iii Introduction to Economic Analysis Version 2.0 by R. Preston McAfee J. Stanley Johnson Professor of Business, Economics & Management California Institute of Technology Begun: June 24, 2004 This Draft: July 24, 2006 This book presents introductory economics (“principles”) material using standard mathematical tools, including calculus. It is designed for a relatively sophisticated undergraduate who has not taken a basic university course in economics. It also contains the standard intermediate microeconomics material and some material that ought to be standard but is not. The book can easily serve as an intermediate microeconomics text. The focus of this book is on the conceptual tools and not on fluff. Most microeconomics texts are mostly fluff and the fluff market is exceedingly over- served by $100+ texts. In contrast, this book reflects the approach actually adopted by the majority of economists for understanding economic activity. There are lots of models and equations and no pictures of economists. This work is licensed under the Creative Commons Attribution- NonCommercial-ShareAlike License. To view a copy of this license, visit http://creativecommons.org/licenses/by-nc-sa/2.0/ or send a letter to Creative Commons, 559 Nathan Abbott Way, Stanford, California 94305, USA. Please email changes to intro@mcafee.cc. McAfee: Introduction to Economic Analysis, http://www.introecon.com, July 24, 2006 iv Table of Contents 1 WHAT IS ECONOMICS? 1-1 1.1.1 Normative and Positive Theories 1-2 1.1.2 Opportunity Cost 1-3 1.1.3 Economic Reasoning and Analysis 1-5 2 SUPPLY AND DEMAND 2-8 2.1 Supply and Demand 2-8 2.1.1 Demand and Consumer Surplus 2-8 2.1.2 Supply 2-13 2.2 The Market 2-18 2.2.1 Market Demand and Supply 2-18 2.2.2 Equilibrium 2-20 2.2.3 Efficiency of Equilibrium 2-22 2.3 Changes in Supply and Demand 2-22 2.3.1 Changes in Demand 2-22 2.3.2 Changes in Supply 2-23 2.4 Elasticities 2-27 2.4.1 Elasticity of Demand 2-27 2.4.2 Elasticity of Supply 2-30 2.5 Comparative Statics 2-30 2.5.1 Supply and Demand Changes 2-30 2.6 Trade 2-32 2.6.1 Production Possibilities Frontier 2-32 2.6.2 Comparative and Absolute Advantage 2-36 2.6.3 Factors and Production 2-38 2.6.4 International Trade 2-39 3 THE US ECONOMY 3-41 3.1.1 Basic Demographics 3-41 3.1.2 Education 3-47 3.1.3 Households and Consumption ... long-run economic growth Introduction to Economic Growth In this chapter, you will learn about: • • • • The Relatively Recent Arrival of Economic Growth Labor Productivity and Economic Growth Components... of Economic Growth Economic Convergence Every country worries about economic growth In the United States and other highincome countries, the question is whether economic growth continues to provide.. .Introduction to Economic Growth economic growth was so rapid that western European workers could purchase 5,000 food