Growth theory: an exposition,

by Robert Solow

With American productivity growing at ever-smaller rates and international stock markets in spectacular turmoil, this distinguished book by one of the greatest living economists is more timely than ever. Organized around the famous Harrod-Domar conditions for equilibrium in a growing economy, Growth Theory: An Exposition presents a concise survey of the modern macroeconomic theory of growth, showing how the character of full-employment growth equilibrium changes and enlarges as more complicated assumptions are made about technology, invention, saving, and the existence of monetary assets. The book explores general policy issues and includes an elementary exposition of the problem of optimal paths of capital accumulation, and the discounting of the benefits of public investments. The paperback edition features the full text of Solow's Nobel Prize acceptance speech.

Genres: Economics

109 pages, Hardcover

First published January 1, 1970

About the author

Robert Merton Solow was an American economist who received the Nobel Memorial Prize in Economic Sciences for the development of a mathematical model for economic growth. He based his model on the earlier Harrod-Domar model but incorporated a significant difference in his own model. This difference lay in the fact that Solow assumed that full employment could be achieved by adjusting the wages given to the workforce. His theory totally contradicted the earlier theory that the economy was facing a great crisis. He soon followed with another theory that labor and capital were not the only two factors required for economic growth as was believed by economists till then. He suggested that a third factor has to be considered if the rate growth is to be calculated in real terms. This factor is called the ‘Solow residual’ which can be attributed to the technical changes that are required for healthy economic growth. He also developed a new model which made new capital more important than old capital which is based on the technology prevalent at the time. With new capital more changes could be brought about in the technological field. His articles on economic growth brought about a huge change in the perspectives that economist had till then about the realities of economic growth.

Reviews

[Cyrill Wiget]

Classic philosophical paper on subjective experience and the explanatory gap.

[Aliyu Maigari · Rating 5 out of 5]

very educational

[GIANELLA]

Necesito conocer la teoría de crecimiento