ECON 209 Chapter Notes - Chapter 26: Diminishing Returns, Real Interest Rate, Loanable Funds
28 Apr 2013
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Document Summary
One of the most important reasons gdp and per capita gdp grows is growth in productivity. Economic growth: sustained, long-run increases in the level of real gdp. 3 aspects of economic growth: real gdp, real per capita gdp and productivity. Economic growth raising avg. income changes whole society"s consumption patterns, shifting away from tangible goods towards services. Economic growth promotes environmental protection as poorer countries are worried about surviving whereas we have the luxury to think about the future environmental problems. Poorest members, not in labour force cannot share the higher wages met by economic growth. Redistribution involves making someone else"s living standards lower but if there"s economic growth then when some of the increment in income is redistributed, it reduces income inequalities while all incomes rise= better/ easier for politicians to implement. An open letter from a supporter of the growth is good school. Growth is thought to have led to a society framed around the ordinary citizen.
