Masters: Effect of automation on business and economy
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The neoclassical growth model , also known as the Solow–Swan growth model or exogenous growth model , is a class of economic models of long-run economic growth set within the framework of neoclassical economics . Neoclassical growth models attempt to explain long run economic growth by looking at productivity , capital accumulation , population growth , and technological progress . [ edit ] Development of the model The neo-classical model was an extension to the 1946 Harrod–Domar model that included a new term: productivity growth. Important contributions to the model came from the work done by Robert Solow and T.W. Swan who independently developed relatively simple growth models. [ 1 ] [ 2 ] Solow's model fitted available data on US economic growth with some success. [ 3 ] In 1987, Solow received the Nobel Prize in Economics for his work.
The Ramsey–Cass–Koopmans model or the Ramsey growth model is a neo-classical model of economic growth based primarily on the work of the economist and mathematician Frank P. Ramsey , with significant extensions by David Cass and Tjalling Koopmans . The Ramsey model differs from the Solow model in that it explicitly models the choice of consumption at a point in time and so endogenizes the savings rate . As a result, unlike in the Solow model , the saving rate may not be constant along the transition to the long run steady state . Another implication of the model is that the outcome is Pareto optimal or Pareto efficient .
The basic form of the Solow model gives us a bit of an unsatisfactory conclusion: 1. The economy will grow in terms of output per worker until it reaches a steady state level of output per worker. At steady state level of output per worker, the economy still grows, but it only grows at the rate of labour force growth (which we model as equal to the rate of population growth).
The basic form of the Solow model gives us a bit of an unsatisfactory conclusion: 1. The economy will grow in terms of output per worker until it reaches a steady state level of output per worker. At steady state level of output per worker, the economy still grows, but it only grows at the rate of labour force growth (which we model as equal to the rate of population growth). 2.
When I looked at the Harrod-Domar model on this blog I basically presented two forms, a basic version : and a version in per capita terms : Because the Solow model is based around the concept of two factors of production (capital and labour), the presence of labour is central to the model because this is why you get diminishing returns to capital as you add more capital , so it makes sense to think about the Solow as a sort of ‘per capita’ model, by thinking in terms of output and capital per worker .
In economics , diminishing returns (also called diminishing marginal returns ) is the decrease in the marginal (per-unit) output of a production process as the amount of a single factor of production is increased, while the amounts of all other factors of production stay constant.
The productivity paradox was analyzed and popularized in a widely-cited article [ 1 ] by Erik Brynjolfsson , which noted the apparent contradiction between the remarkable advances in computer power and the relatively slow growth of productivity at the level of the whole economy, individual firms and many specific applications. The concept is sometimes referred to as the Solow computer paradox in reference to Robert Solow 's 1987 quip, "You can see the computer age everywhere but in the productivity statistics." [ 2 ] The paradox has been defined as the “discrepancy between measures of investment in information technology and measures of output at the national level.” [ 3 ] It was widely believed that office automation was boosting labor productivity (or total factor productivity ). However, the growth accounts didn't seem to confirm the idea. From the early 1970s to the early 1990s there was a massive slow-down in growth as the machines were becoming ubiquitous.
An Osborne Executive portable computer, from 1982 with a Zilog Z80 4MHz CPU, and a 2007 Apple iPhone with a 412MHz ARM11 CPU. The Executive weighs 100 times as much, is nearly 500 times as large by volume, costs approximately 10 times as much (adjusting for inflation), and has 1/100th the clock frequency of the phone. Moore's law is the observation that over the history of computing hardware , the number of transistors on integrated circuits doubles approximately every two years.
Most people are familiar with Moore's Law, the doubling of computer power roughly every 18 months. But as technology becomes more mobile "Koomey's Law" may be more relevant to consumers.
Rock's law or Moore's second law , named for Arthur Rock , says that the cost of a semiconductor chip fabrication plant doubles every four years. As of 2003, the price had already reached about 3 billion US dollars.
Wirth's law is a computing adage made popular by Niklaus Wirth in 1995. [ 1 ] [ 2 ] It states that "software is getting slower more rapidly than hardware becomes faster."
Moore's Law will continue for at least another 10 years, according to Intel cofounder Gordon Moore, but it's going to take a lot of work. "Another decade is probably straightforward," Moore said, speaking at the International Solid-States Circuits Conference. "There is certainly no end to creativity."
The wheat and chessboard problem (the problem is sometimes expressed in terms of rice instead of wheat) is a mathematical problem in the form of a word problem : If a chessboard were to have wheat placed upon each square such that one grain were placed on the first square, two on the second, four on the third, and so on (doubling the number of grains on each subsequent square), how many grains of wheat would be on the chessboard at the finish?
Larry and Sergey founded Google because they wanted to help solve really big problems using technology. And one of the big problems we’re working on today is car safety and efficiency. Our goal is to help prevent traffic accidents, free up people’s time and reduce carbon emissions by fundamentally changing car use.
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