The Solow Model of Economic Growth.

The Solow Model of Economic Growth. a simple model but from which you can derive so many insights! GDP= f(K, EL, A) The relation of capital (K), Labor and technology to GDP The law of diminishing returns and its implication to the steady state equilibrium (investment on capital vs. depreciation) The impact of education and labor (EL) and its investment to sustain the level of growth also will leads to a steady state equilibrium and will lead to conditional convergence. Technology or ideas (A) how it contributes to growth, that has a multiplier effect on growth and makes the difference between catching-up growth and cutting edge-growth. A good recap on basic economic principles, that when you think it also applies to company valuation (to be further developed in a future note or post). Enjoy! https://marginalrevolution.com/marginalrevolution/2024/03/teaching-the-super-simple-solow-model.html https://youtube.com/playlist?list=PL-uRhZ_p-BM6L_I3IHvE85NHooK2Ln9Rm&si=tqMNXL-DApeStem7

- Pedro

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