AUECO102 Lecture Notes - Lecture 3: Human Capital, Private Equity, Diminishing Returns

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sapphiredonkey827

13 Sep 2017

School

University of Alberta

Department

Augustana Faculty - Economics

Course

AUECO102

Professor

yasserfahmy

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Document Summary

How is productivity is determined: the inputs used to produce goods and services are called factors of production, the factors of production directly determine productivity, the factors of production: Physical capital: produced factor of production. Input into the production process that in the past was an output from the production process: the stock of equipment and structures that are used to produce goods and services. Tools used to build or repair automobiles. Human capital: the economists"s term for the knowledge, and skills that workers acquire through education, training, and experience. Like physical capital, human capital raises a nation"s ability to produce goods and services. Natural resources: inputs used in production that are provided by nature, such as land, rivers, and mineral deposits. Nonrenewable resources include petroleum and coal: can be important but are not necessary for an economy to be highly productive in producing goods and services. Technological knowledge: society"s understanding of the best way to produce goods and services.

Related Questions

Article by Brandon Fuller.

A nation's GDP is determined by its labor force, its capital stock, and its technological knowledge. An increase in the amount of capital per worker increases a nation's GDP. An improvement in technology allows a nation to get more GDP out of its existing capital stock. Technology refers to the way an economy organizes its labor and capital to produce goods and services. If two nations have the same number of workers and capital but one nation uses better technology to get more out of its labor and capital, it will generate more GDP. The nation with better technology has higher productivity - it gets more output per hour of labor input.

A recent Hal Varian commentary in the New York Times focused on the role of technological knowledge in explaining the different productivity experiences of Europe and the United States. Compared to Europe, the United States experienced much stronger growth in output per labor hour over the past decade. Why? The evidence suggests that American firms integrate information technology more quickly than their European counterparts. Follow the link to find out more: Productivity.

ivoryoyster898

This question is from the article below.

By Brandon Fuller.

A nation's GDP is determined by its labor force, its capital stock, and its technological knowledge. An increase in the amount of capital per worker increases a nation's GDP. An improvement in technology allows a nation to get more GDP out of its existing capital stock. Technology refers to the way an economy organizes its labor and capital to produce goods and services. If two nations have the same number of workers and capital but one nation uses better technology to get more out of its labor and capital, it will generate more GDP. The nation with better technology has higher productivity - it gets more output per hour of labor input.

A recent Hal Varian commentary in the New York Times focused on the role of technological knowledge in explaining the different productivity experiences of Europe and the United States. Compared to Europe, the United States experienced much stronger growth in output per labor hour over the past decade. Why? The evidence suggests that American firms integrate information technology more quickly than their European counterparts. Follow the link to findout more: Productivity.