The Solow Model of Economic Growth Analytical Essay by Hans

A review of the Solow model of economic growth, considering theoretical and empirical evidence.
# 149753 | 1,259 words | 14 sources | APA | 2009 | GB
Published on Dec 30, 2011 in Economics (General)


$19.95 Buy and instantly download this paper now

Description:

This paper gives a brief introduction to the Solow model of economic growth and applies the model to the UK, Kenya and China. The paper considers the pros and cons of the model in the context of both theoretical and empirical research within the field of economics, comparing the results between developing and developed economies. This paper contains equations.

Outline:
The Solow Model of Growth Defined
Analysis

From the Paper:

"Given the figures above the UK's having the lowest rate of economic growth would support the Solow model of economic growth since it is also the country which had the lowest rate of growth in population representing labour and savings representing the accumulation of capital. By comparing China and the UK the effect of the rate of savings may be seen as a significant factor in the difference between the growth rates of GDP given that the difference in population growth is just 0.05% yet the savings rate would seem to account for a 7.875% faster rate of economic growth in China than in the UK. Again when comparing Kenya a country that has both a higher rate of labour growth than the UK with a rate of growth 2.025% higher than the UK's and a savings rate of 8.8% higher than the UK's has yielded a rate of economic growth which using the GDP measure is 1.925% higher than that of the UK's. As such one may conclude that the results of this analysis prove the Solow model of economic growth to be accurate in these cases.
"However despite this conclusion there are alternative explanations of why the economies of Kenya and China have grown faster than that of the UK which are not explained by the factors already considered under the Solow model of economic growth. In order to analyse alternative explanations it is now necessary to look to analyse alternative explanations the main alternative model being that of the exogenous growth model (Samuelson and Nordhams 1992)."

Sample of Sources Used:

  • Begg, D, Fischer, S, Dornbusch, R. 2000. Economics. 6th ed. London: McGraw-Hill.
  • Dasgupta, P. 2007 Economics. Oxford: Oxford University Press.
  • Earth Trends. 2009. Kenya National Profile. Available online at: http://earthtrends.wri.org/pdf_library/country_profiles/eco_cou_404.pdf [Accessed on 23/11/09].
  • Griffiths, A, Wall, S. 2001 Applied Economics. 9th ed. Harlow: FT Prentice Hall.
  • Mackintosh, M, Brown, V, Costello, N, Dawson, G, Thompson, G, Trigg, A. 1996. Economics and changing economies. London: Thompson Business Press.

Cite this Analytical Essay:

APA Format

The Solow Model of Economic Growth (2011, December 30) Retrieved June 30, 2022, from https://www.academon.com/analytical-essay/the-solow-model-of-economic-growth-149753/

MLA Format

"The Solow Model of Economic Growth" 30 December 2011. Web. 30 June. 2022. <https://www.academon.com/analytical-essay/the-solow-model-of-economic-growth-149753/>

Comments