ECON 103 Chapter Notes - Chapter 12 : Michael Kremer, Human Capital, Physical Capital
20 Jan 2017
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Gnp: stuff american producers make in other countries is also included in our gnp. People are less willing to invest if there is property and political instability. Political instability- contracts are hard to enforce and fraud goes unpunished and discourages domestic saving and investment from abroad. Inward oriented policies- trade restrictions, tariffs, distrust of foreigners. To protect country from foreign investors and foreign competition so promote goods and services of domestic. Large population = more workers to produce goods and services means increase in gdp. Low standard of living cuz lots of people consuming these goods and services. Malthus says that population increase, people forever live in poverty. Michael kremer- population growth is increasingly more rapid, means large population induces more tech progress. More people in region, the more region should have in tech growth. Catch up effect- country starts up relatively poor.
