AS.180.101 Lecture Notes - Lecture 9: Paul Krugman, Four Asian Tigers, Thomas Robert Malthus
Document Summary
Output growth: the reality since the industrial revolution. Growth has been the rule and goal since industrial revolution. Thomas malthus, 1826: when all the fertile land is occupied, the yearly increase in food must depend upon the land already in possession, this is a fund which must gradually be diminishing. This theory is dead wrong: technological change has increased production nearly every year since 1948. How do we make labors input more productive: we can give them tools, better tools rate of technical change, we can train and educate laborers. Increasing results will lead to diminishing returns smaller increase in output resulting from capital depletion. The 1990s fascination with booming asian tigers. The asian tigers were growing 5% per year, and the gurus declared they had a new model for growth. Krugman said no, they were simply capital deepening. Once they catch up to western k/y rations their growth rates would look like the west.
