ECON 1010 Chapter Notes - Chapter 22: Real Wages, Potential Output, Workforce Productivity
Document Summary
South korea: slow economic growth can result in devastating poverty, e. g. somalia, zambia, economic growth calculation: change in real gdp, [(real gdp current real gdp previous year)/real gdp in previous year] x. Increase in quantity of labour brings a movement along the production function and an increase in real gdp. Therefore, using the labour market equilibrium in combination with the. Apf ppf, we can determine potential gdp: what makes potential gdp grow, growth of the supply of labour. Growth in the supply of labour shifts the labour curve rightward, thus increasing the quantity of labour at any given wage rate. Qlabour = employment x average hours worked. Quantity of labour changes as a result of: average hours per worker, employment-to-population ratio, working-age population. Traditionally, growth in supply of labour has come from growth in working-age population. Increased quantity of labour produces more output and potential. Labour productivity is the quantity of real gdp produced by an hour of labour.
