ECONOMIC GROWTH
437
growth of labour employed, and the increased output due to the availability of
additional capital equipment. From Eq. (16.2), this may be written as
7
Y
___
Y
=
A
___
A
+
K
___
K
+
(1
-
)
L
___
L
(16.3)
where,
Y
___
Y
is rate of growth of output;
K
___
K
is rate of growth of the capital stock;
L
___
L
is rate of growth of the labour force; and
A
___
A
is rate of technological progress.
Solow recognized that the only unobservable variable in Eq. (16.3) is the
rate of technological progress,
A/A.
This could be calculated by taking it to
the left-hand side of ...
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