ECON3109 Lecture Notes - Lecture 1: Diminishing Returns, Production Function
Document Summary
Institutions: with economic development, growth is associated with structural change, with social change and with changes in the important institutions of the economy. Institutions are the result of historical and social developments. Institutions will differ between countries because they have different pasts, differences in culture environment and so on: these differences will then feed back into different economic and other developments. Measuring growth and development: compared with economic growth, development seems to be much more complex and multi-faceted, and much more difficult to measure, limitations to measurement of gdp (output) within country magnified with comparisons between countries. Some major issues: the role of governments v markets, the influence of international trade, trade off between economic growth and human rights, trade off economic growth and the environment, convergence versus divergence in growth rates. Cumulative causation: development is not a smooth gradual process, the concepts of virtuous and vicious cycles, and the related one of cumulative causation.
