Some data that at first might seem puzzling: The share of GDP devoted to investment was similar for the United States and South Korea from 1960-1991 . However, during these same years South Korea had a 6 percent growth rate of average annual income per person, while the United States had only a 2 percent growth rate. If the saving rates were the same, why were the growth rates so different?
The explanation is based on the concept of diminishing returns to capital. A country that has a lot of income, and so a lot of capital, gains less by adding more capital than does a country that currently has little capital. It is easy to envision how a poor country without much capital could increase its output considerably with even a little more capital.
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Apple and Samsung agree to stop undercutting each other's phone prices. Which of the following antitrust acts are being violated?
A. Clayton Act B. Sherman Act C. Federal Trade Commission Act D. No Antitrust law is being violated
The figure above shows a perfectly competitive firm. When the firm maximizes its profit, its economic profit
A) is more than $300. B) is $300. C) is less than $300. D) The premise of the question is wrong because the firm is incurring an economic loss.
An investor purchasing an inflation-protected bond with a fixed annual real return of 1.75 percent will earn a nominal annual return of ________ percent if the actual inflation rate turns out to be 3.25 percent.
A. 5.69 percent B. 1.86 percent C. 5.00 percent D. 1.50 percent
Federal antitrust laws in the United States are intended to
A. promote competition by prohibiting monopolies. B. create only government-owned organizations. C. promote income equality. D. create new monopolies.