《初级宏观经济学》（英文版）Chapter 11 Economics Growth and Economic Cycle

Chapter 11 Economic growth and Economic cycle 复表经济学院

Chapter 11 Economic growth and Economic cycle 0 10 20 30 40 90 91 92 93 94 95 96 97 98 99 00

Topics to be Discussed o 11.1 Summary o Initial research about the economic growth s The definition about the economic growth s Weighing standard about the economic growth Headspring of the economic growth Economic growth and economic development 复表经济学院

Topics to be Discussed  11.1 Summary ❖ Initial research about the economic growth ❖ The definition about the economic growth ❖Weighing standard about the economic growth ❖ Headspring of the economic growth ❖ Economic growth and economic development

Topics to be Discussed o 11.2 Classical growth theory ÷ Basic supposition o Harrod-Domar growth model o 11.3 New classical economic growth theory ⊙114 Economic cycle o 11.5 Explanation of the economic cycle 复表经济学院

Topics to be Discussed  11.2 Classical growth theory ❖ Basic supposition ❖ Harrod——Domar growth model  11.3 New classical economic growth theory  11.4 Economic cycle  11.5 Explanation of the economic cycle

11.1 Summary o Definition about the economic growth o The growth about the ability of producing goods and labor services in one country es The long-term rise in supplying the residents increasing economic products 复表经济学院

11.1 Summary  Definition about the economic growth ❖ The growth about the ability of producing goods and labor services in one country。 ❖ The long-term rise in supplying the residents increasing economic products

11.1 Summary o Weighing standard about the economic growth GDP can not be regarded as the economic growth rate because *(1) price ; *(2) population change (3) potential, not real a (4) can not reflect the welfare increasing, environment pollution 复表经济学院

11.1 Summary  Weighing standard about the economic growth : ❖ GDP can not be regarded as the economic growth rate，because：  （1）price；  （2）population change；  （3）potential ,not real；  （4）can not reflect the welfare increasing、environment pollution

11.1 Summary ⊙ Headspring . Denison' s seven factors a Supply increase in the producing elements labour element (1)employment number and age and sex structure (2) working hours (3)education years capital elements( 4)the total capital productivity increase( technology progress (5)effectiveness of resources collocation (6) scale economy (7) knowledge development 复表经济学院

11.1 Summary  Headspring ❖ Denison’s seven factors：  Supply increase in the producing elements ： labour element （1）employment number and age and sex structure （2）working hours （3）education years capital elements （4）the total capital  productivity increase （technology progress） （5）effectiveness of resources collocation （6）scale economy （7）knowledge development

11.1 Summary o Economic increase and economic development Economic Growth: is defined that the increased percentage about the relative comparison between current GDP and the former GDP △Y1-Y11 Y t-1 .s Economic Development: is the result of the continuing economic growth 复表经济学院

11.1 Summary  Economic increase and economic development ❖ Economic Growth：is defined that the increased percentage about the relative comparison between current GDP and the former GDP ❖ Economic Development：is the result of the continuing economic growth. 1 1 − − − =  t t t Y Y Y Y Y

11.2 Classical Economic Growth Theory ■ Basic Presumption Long-term growth trend upward inclined curve Y(GDP) indicates the continuing increase in the potential producing ability. In the short term it can be a little C deviated, such as a。 Two coefficients can be used to describe: slope intercept A 复学终济学院

11.2 Classical Economic Growth Theory ◼ Basic Presumption Y(GDP) t Long-term growth trend: upward inclined curve indicates the continuing increase in the potential producing ability. In the short term it can be a little deviated，such as A。 Two coefficients can be used to describe: slope , intercept。 A B C

11.2 Classical Economic Growth Theory ⊙ Presumption1 The number of the labour is increased in exponential form * Lt: labour is the function of the time Lo labour radices i *e: natural logarithm *gL: labour growth rate L=l L 0 复表经济学院

11.2 Classical Economic Growth Theory  Presumption 1 ❖ The number of the labour is increased in exponential form；  Lt：labour is the function of the time；  L0 ：labour radices；  e ：natural logarithm；  gL ：labour growth rate g t t L L L e . = 0

11.2 Classical Economic Growth Theory ⊙ Presumption2 . o Technology progress can be expressed by the “ Effective Labor units” Et: Effective Labor Units a technology progress coefficient Et=le at o getout 们e(S+2 复表经济学院

11.2 Classical Economic Growth Theory  Presumption 2 ❖ Technology progress can be expressed by the “Effective Labor Units”；  Et ： Effective Labor Units；  ：technology progress coefficient g t 0 g t t 0 t t t L L L e L e e E L e ( )   + = = = 