BUSI 2701 Lecture Notes - Lecture 2: Market Economy, Gross National Income, Purchasing Power Parity
Document Summary
Gross national income: total income (domestic and foreign) of all citizens in a country. Purchasing power parity: adjustment in gdp per capita for a comparison of living standards in different countries. Measures the quality of human life in terms of. Life expectancy (a function of health care) Education attainment (measured by a combo of adult literacy rate and the enrolment in primary, secondary, and tertiary education) Average incomes (adequate food, shelter, and health care) Innovation and entrepreneurial activity are the engines of long run economic growth. Innovation is also seen as the product of entrepreneurial activity. Innovation and entrepreneurial activities require strong property rights. If you invent something, people should not be able to copy it and make money off of you. W/o strong property rights, businesses and individuals that profits from their innovations will be expropriated. Innovation and entrepreneurship are the engines of growth.
