Modern models economic growth formed on the basis of two sources: the Keynesian theory of macroeconomic equilibrium and the neoclassical theory of production.
Neo-Keynesian models. Keynes's theory does not consider technological progress. It characterizes effective demand in the short term and substantiates the ways of demand formation in conditions of underloading. production capacity and the presence of unemployment. But after the Second World War, scientists began to worry about the question of how to achieve high and sustainable rates of economic growth.
Neo-Keynesian theory is based on several premises. At the heart of growth national income there is only one factor - the rate of accumulation of capital. Other factors (employment, use of equipment, organization of production) are excluded. Hence the conclusion: the demand for capital at constant capital intensity is determined only by the growth rate of national income. Capital intensity is determined only specifications production to keep it unchanged. Capital intensity - the value of the cost of fixed capital per unit of output. It characterizes the efficiency of fixed capital use. Only neutral investments are considered: new investments do not change capital intensity. Thus, the determining factor in economic growth is the increase in investment.
The simplest neo-Keynesian model of economic growth is the Domar-Harrod model. In it there is only a market for goods. The following assumptions apply: national income is proportional to the amount of capital; there is an excess supply in the labor market, so the price level is constant; the market for goods is balanced; the output of production depends on one factor - capital.
In this case, = 8- K, where 8 is the rate of return, K is the amount of capital, therefore,
8 = Y / K, i.e. The average productivity of capital shows how much income is produced by capital.
AY = 8 - AK. If AK = I, then
AY = 8-I.
Assume that the savings rate is constant. Since AY = mult -I, where mult = 1 / MPS,
Consequently,
AY = AI-1 / MPS. Substitute
AI /MPS = 8-1, or AI / I = 8-MPS.
Since I = S and S = MPS - Y, where MPS is const, therefore,
AY / Y = AI / I = 8 - MPS.
Under given technical conditions of production, the rate of economic growth depends on the marginal propensity to save. The ratio AY/Y represents the increase in income at full employment. At this rate of growth, business expectations will be realized or “guaranteed”. The growth rate that satisfies these conditions is called guaranteed. It guarantees the full use of existing capacities (capital). But full employment is not always achieved. To ensure guaranteed growth, both labor and capital must increase at the same rate, and the ratio of their values must be strictly defined.
Let's introduce the concept of "natural growth rate". This is the rate of growth of capital and national income that provides full employment for the growing supply of labor. If the guaranteed rate of growth is greater than the natural rate, then because labor is scarce, there will be no actual rate of growth and a depression will result.
If a natural growth more than guaranteed, then an excess of labor resources will increase investment and actual growth will be more than expected. As a result, the dynamic equilibrium in terms of economic growth is unstable.
Thus, we can conclude that investments, which are its main instrument, play a special role in economic growth.
As part of market economy there is no automatic leveling mechanism. In this regard, state intervention in the economy is necessary.
neoclassical models. An important role in the development of the theory of economic growth was played by the production function of Cobb-Douglas and the work of Robert Solow, laureate Nobel Prize.
The Solow model is based on the Cobb-Douglas production function, in which the contribution of various factors of production to the increase in output was calculated. The Cobb-Douglas function states that a 1% increase in capital costs increases output by 1/4, and a 1% increase in labor costs increases output by 3/4.
Other prerequisites for economic growth in the Solow model. Labor and capital are completely interchangeable. Positive diminishing returns on factors of production. Savings are fully invested.
So, = F (K, L). Let's divide everything by L:
Y/L = F(K/L, L/L); Y/L = F(K/L, 1).
Let Y/L = y, where Y/L is labor productivity. Then y = F (K/L), where K/L is the capital-labor ratio. Income is a function of one factor - capital-labor ratio, i.e. y = c + i.
Note that (c + i) is the consumption of the good and investment per worker.
C \u003d (1 - 5) y, then
y = (1 - 5) (y + i). Divide both sides of the equation by y, then
1 \u003d (1 - 5) + i / y, or i / y \u003d *, therefore, I \u003d s y.
That is, investment is proportional to income. Substitute
y \u003d f (K) \u003d * f (K).
The greater the value of capital-labor ratio, the greater the volume of production and the higher the size of investment.
Conclusion: high level savings leads to faster economic growth.
The Solow model has been used by economists to answer what optimal economic growth should be. In the 1960s American economist Helps, considering economic problems the kingdom of Solovia invented by him (named Solow), formulated the so-called " Golden Rule capital accumulation". It lies in the fact that each generation should save for future generations such a share of the income that it received from previous ones. In other words, the rate of interest must be equal to the rate of population growth. In this case, the trajectory will be optimal. This rule is sometimes referred to as the "biological rate of interest" rule.
Questions for self-control Name the types of economic growth and their character traits. What caused the need for Russia's transition to an innovative path of development? What are distinctive features innovative type of development? Think about the dependence of the dynamics of economic growth on direct and portfolio foreign investment? What approaches to regulating economic growth exist in various countries peace?
Subject term papers Contemporary Issues state stimulation of economic growth. Theories of economic growth and their practical value. Transition issues Russian economy on an innovative path of development. Financial and industrial groups and their role in sustainable development. Economic growth and its main factors.
Economic growth, its modeling, taking into account the state of ecology and social sphere in economic and mathematical models
Models of economic growth are widely represented in economic research. Based on these models, various problems of analysis and forecasting of the development of national economies are solved.
Modern models of economic growth take into account the possibility of investing not only in physical capital, but also in a number of other production resources. This is due to the recognition that the increase in the efficiency of the use of productive resources contributes to big number technological, organizational and other factors, the totality of which is covered by the concept of scientific and technological progress (STP).
Besides, in last years there are more and more works that explore how the growth of production affects the environmental situation, how the environment affects the possibility of growth, how the level economic development associated with various indicators characterizing the state of the social sphere. However, due attention is not paid to the mutual influence of the economy, ecology and the social sphere, despite the desire of many countries of the world for sustainable development, which is understood as development that satisfies the needs of both present and future generations in economic and environmental benefits. This means an increase in gross domestic product(GDP) while reducing the anthropogenic load on the environment. The concept of sustainable development also includes the problems of reducing the gap in the levels of economic development of various countries and the well-being of their population, security, etc.
The solution of these problems requires the use of methods of economic and mathematical modeling of economic growth, taking into account environmental and social factors.
Exogenous - external; endogenous - internal.
Development of economic growth models
The theory of economic growth has gone through three major waves of development. The first was connected with the work of E. Lundberg and developed by Harrod and Domar. These works appeared in the late 30s and 40s. In the mid-1950s, the emergence of Solow and Swan's neoclassical growth model sparked a second, longer wave of interest in the subject among economists. The third wave of research began in the mid-1980s with the work of Romer and Lucas and continues to the present.
Harrod and Domar tried to combine Keynesian analysis with elements of economic growth. They used production functions with little factor substitution to argue that the capitalist system is inherently unstable. Since they wrote during and immediately after the Great Depression, their arguments have been accepted by many economists. Their results played a role in the development of the theory, but their analysis is very rarely used at present.
The next and more important achievement belongs to Solow and Swann, who published their work in 1956. Key Aspect The Solow-Swan model is a neoclassical form of the production function that assumes constant returns to scale, diminishing returns to each factor, and positive elasticity of factor substitution. This production function, together with a constant rate of accumulation, is used to create the simplest model. general equilibrium in economics.
One of the consequences of this model has come to be used as an empirical hypothesis only in recent years. It's about about conditional convergence. A lower starting level of real GDP per capita relative to the long run or steady state results in a higher growth rate. This property follows from the assumption of diminishing returns to capital. Economies with less capital per worker tend to grow faster. Convergence with respect to the equilibrium level of capital and output per unit of labor depends in the Solow-Swan model on the rate of accumulation, the population growth rate and the state of the production function, i.e. characteristics that may vary from economy to economy. Modern research makes it possible to take into account differences between countries, especially in public policy and the initial state of human capital. However, the concept of conditional convergence, a key feature of the Solow-Swan model, explains to a large extent economic growth in various countries and regions.
Another consequence of the Solow-Swan model is that there is no endless improvement in technology, growth (in terms of capital-labor ratio) must gradually cease. This is also a consequence of diminishing returns on capital.
Neoclassical growth theorists of the late 1950s and early 1960s. recognized such modeling as insufficient and often supplemented it with the assumption of the exogenous nature of scientific and technological progress. This made it possible to talk about a positive, possibly constant growth rate in the long run, and this growth depends on the rate of scientific and technological progress, which is determined outside the model.
Perhaps due to the lack of empirical relevance, growth theory practically ceased to develop as a direction of active research in the early 70s. on the eve of the revolution rational expectations and oil shocks. For about fifteen years, the development of macroeconomics has focused on short-term fluctuations. Major advances included accounting for rational expectations in the theory business cycle, improved approaches to political development and the application of general equilibrium analysis methods to real business cycle theory.
Since the mid-1980s, economic growth research has experienced a new boom, which began with the work of Romer and Lucas. The reason for this is that the factors that determine long-term economic growth are much more important than the business cycle mechanism or the outcome of the monetary or fiscal policy state, aimed at counteracting cyclical fluctuations. But realizing the importance of long-term growth is only the first step. To go further, it is necessary to avoid the limitations of the neoclassical growth model, in which the rate of long-term growth in the capital-labor ratio is tied to the rate of exogenous scientific and technological progress. Thus, it is necessary that new developments determine the long-term growth rate within the model. Therefore, the creation of models of endogenous growth is required.
New research also includes technology diffusion models. Since discoveries are made mainly in more developed countries, when studying diffusion, the question arises of how other economies imitate these discoveries. Since imitation is cheaper than innovation, a form of conditional convergence follows from diffuse models, similar to that arising from the neoclassical model.
Another key exogenous parameter in the neoclassical growth model is the population growth rate. A higher population growth rate reduces the equilibrium level of capital and output per unit of labor and thus lowers the growth rate of capital-labor for a given level of output. However, the standard model does not address issues of the impact of returns on capital and the rate wages to population growth. Other researchers consider endogenous population growth by incorporating an analysis of household choice regarding childbearing into the neoclassical model. Works have also been published that examine the endogenous growth of the labor force as a result of migration and the choice of workers in favor of work or leisure.
Theoretical conclusions from the presented models of growth with endogenous technological progress are confirmed by many trends in world development associated with the deepening of globalization processes. At the same time, vulnerabilities of the new theory have been identified, especially in connection with the “scale effect”, which is not supported by empirical data at the country level. This concerns, in particular, the dependence of growth rates on the number of specialists employed in R&D, predicted in these models.
Fundamental or underlying sources of growth are variables that affect the ability to national economy accumulate factors of production and invest in knowledge production. Factors affecting economic growth include population growth, financial sphere and the environment Natural resources, rules of trade, the size of the state, indicators of political and social development. In addition, a number of researchers Abramovitz, Dawson, Baumol and others consider the influence of such factors as the institutional structure of the economy, "social potential", " social infrastructure' or 'auxiliary variables'. Many authors consider human capital how key factor economic growth.
AT economics There are various models of economic growth, among which are Keynesian, neoclassical, historical and sociological, models of intersectoral balance, etc. Any of the models of economic growth implies a balance of resources and production, which must always be in certain proportions.
Models of economic growth are designed to identify the conditions and trends of economic growth. The initial models of economic growth are the so-called production macroeconomic functions. They are classified as neoclassical growth models.
Such qualitative changes are: the growth of the qualifications of the employed; innovations - scientific and technical achievements used in production; improvement of the organization of production, etc.
For the first time, the production function, taking into account the factor of technical progress, was introduced by the Dutch economist, Nobel Prize winner, Jan Tinbergen (1942). He deduced a kind of production function. Further development of production function models, taking into account technical progress (technical progress is understood as an increase in national product caused by qualitative changes in capital, labor and other factors of production) are associated with the names of E. Domar, R. Harrod, Solow, J. Mead, E. Denizon.
Domar model. The simplest post-Keynesian model of economic growth is the Domar model.
In it, only the market for goods is explicitly present. The production technology is represented by the Leontief production function with constant technological factor cost factors. It is assumed that there is an excess supply in the labor market and this ensures the stability of the price level. The market for goods is initially balanced. Increase factor aggregate demand and aggregate supply is an increase in investment.
Taken together, it follows from E. Domar's theory of growth that there is an equilibrium growth rate at which the full use of the existing production capacities in each period is guaranteed.
Harrod model. R. Harrod came to similar conclusions somewhat earlier than E. Domar. Unlike Domar, Harrod Special attention pays labor force employment with economic growth. If in the Domar model the volume of investments is a given function of investments based on the principle of acceleration and the expectations of entrepreneurs regarding aggregate demand, then in the Harrod model, as well as in the Domar model, the dynamic equilibrium in terms of economic growth is unstable. The pessimistic conclusion of Harrod and Domar about the intrinsic instability of the growth of a market economy prompted economists to study the problem of equilibrium growth in more depth.
N. Kaldor sees the reason for the instability of equilibrium growth in a constant price level. In his opinion, with flexible prices, savings and investments are constantly aligned. Unlike R. Harrod and E. Domar, N. Kaldor takes into account the inequality of marginal propensities to save between entrepreneurs and households. Because entrepreneurs have a greater marginal propensity to save than households, as their share of national income increases, the average saving rate rises.
Consequently, with flexible prices, the market mechanism ensures stable equilibrium growth of the economy.
Neoclassical models of economic growth. Neoclassical models in conditions of balanced demand introduced the volatility of the capital ratio. Capital ratio: production becomes flexible due to the fact that neoclassical models take into account not one, but two factors of production and assume their interchangeability. The growth of the gross national product becomes possible due to various combinations of production factors.
Naturally, neoclassical models are effective under perfect competition, although they also consider deviations from it at the same time.
In the neoclassical model, the main assumption is that each factor of production "provides" a corresponding share of the product produced, and the main tool of analysis is the production function. The meaning of the production function is a certain combination of various factors of production in order to achieve the maximum volume of production.
Since the factor is interchangeable, this approach can be used when planning the rate of economic growth due to various factors of production.
Unlike post-Keynesian and neoclassical growth models, the capital-labor ratio is not constant, but varies depending on the state of the market. For this, in addition to the technical interchangeability of factors of production, the premise of the neoclassical concept of the dominance of perfect competition in the factor market is necessary.
Model of economic growth R Solow. Neoclassical models of economic growth are based on the creation of the value of the product by all production factors, each of which creates its own part of the value, while the factors of production are independent and interchangeable.
There is a certain relationship between the output of products and the resources necessary for its production. The neoclassical model is the Solow model. It is not one of the latest, but it clearly demonstrates that the neoclassicists take into account the factors of production in the growth of the quantity of the product, for which the production function is introduced into the model.
R. Solow proves that the instability of dynamic equilibrium in post-Keynesian models is a consequence of the non-interchangeability of factors of the production function. Instead of the production function, Leontief Solow uses the Cobb-Douglas production function in his growth model, in which labor and capital are good substances and the sum of the coefficients of output elasticity by factors is equal to one. Thus, in the Solow model, the average productivity of labor is a function of its capital-labor ratio.
Keynesian models of economic growth. In addition to neoclassical models, there is a group of so-called Keynesian models of economic growth. Macroeconomic theory of Keynes and the Keynesian model, we will analyze in the following topics of our course. The main idea of Keynes is that in order to bring the economy out of depression to positive economic dynamics it is necessary to increase aggregate demand, mainly through additional investment. Investments will give a multiplier effect, that is, they will cause a multiple increase in the national product.
Keynes considered only the short-term period of economic development, and his followers removed this limitation by developing a number of neo-Keynesian models of economic growth. The most famous models are Harrod and Domar.
The theoretical sources of economic growth models are the Keynesian theory of macroeconomic equilibrium (along with the model of J. M. Keynes, of course, it is theoretical and not classic model) production theory. The versatility of economic growth is also reflected in the variety of its models existing in economic science: single-factor, multi-factor, statistical, dynamic, etc., their combinations. Keynesian models are based on the dominant role of demand in ensuring macroeconomic equilibrium. The decisive element of demand is investment, which, through a multiplier, increases profits, since capital investments represent a function of increasing profits. But more and more often, Keynesian models began to be called post-Keynesian growth models, in which Keynesian premises and methods of analyzing the economic situation in the short period are used to describe economic processes in the long run.
Keynesian models are based on explanation various levels dynamic balance. If aggregate demand has absorbed all aggregate supply, then the planned rate of supply growth that existed before. The production parameters for the future period are determined based on the amount of capital or investment. Demand and income depend on the increase in investment and the marginal propensity to consume. If the growth rate of production corresponds to demand, then such growth is called guaranteed.
Keynesian models are one-factor, since the growth of production is considered as a function of capital. It does not take into account the prices of production factors, but only the technical conditions of production.
The production function of economic growth. The production function shows the dependence of the value of the national product on the factors of production that create it.
Using production functions, you can solve the following problems:
1. Determine potential growth rates depending on the dynamics of the volume of economic resources involved.
2. To reveal the share of this or that factor in the production and growth of the national product.
3. Set the amount of remuneration of factors of production, based on their marginal productivity.
Choose the optimal combinations of factors of production that provide a certain amount of output. Production functions make it possible to estimate how much it will cost society to replace a unit of one factor by a certain amount of another.
The most important features of the Cobbo-Douglas function, when interpreted in the spirit, can be formulated as follows:
1) the constancy of profit and unit costs is assumed, the absence of accumulation, the absence of accumulation, the sum of the elasticity of production (labor and capital) is equal to one. The degree of interchangeability put a given level of technical development;
2) an unlimited replacement of labor by capital is theoretically possible;
3) the function does not take into account changes in the quality of production factors, that is, technical progress is eliminated. From this we can conclude that the function is acceptable only for extensive economic growth.
Multigraphic model of economic growth. The main source of economic growth are economic resources, which any state has to increase the volume of goods and services produced. The interaction of resources is well expressed by the production possibilities curve. The production possibilities curve graphically demonstrates that with the direct use of economic resources, a simultaneous increase in the production of goods and services in subsequent periods is possible only with an increase in the resource capabilities of society. Production resources can also be changed by resources of direct impact on economic growth. And if economic resources in each period are relatively limited, then the potential for growth of material and financial resources on the basis of scientific and technical progress in the long term is practically unlimited. This determines the growth of this factor (NTP) in the system of economic growth factors.
In terms of administrative command economy the state did not take into account these circumstances, which significantly distorted planning and forecasting. Or else. The use of capital and production in general depend to a large extent on the level of entrepreneurial activity, which, in turn, is a function of education, talent, and other management qualities
The above is one of the aspects of the multi-graphic model of economic growth.
Two-factor model of economic growth. In theory and practice, one has to meet with two-factor models in which only labor and capital appear. There are two options for building a two-factor model.
In the first NTP is not taken into account, in the second - it is taken into account. In the first variant, the accumulation of capital (in the absence of scientific and technical progress) at constant costs will lead to a decrease in the final marginal product, that is, there will be a decrease in final productivity. In the second option, labor and capital are more productive. Big income can be obtained with the same input of labor and capital. Investments that entail an increase in the return on capital, in theory and in practice, deny the law - the tendency of the rate of profit to decrease.
Economic Growth Models are economic and mathematical models that describe changes over time economic indicators characterizing the development and growth of the economy as a whole, its industries, individual economic entities.
Models of economic growth contain three main dependences of the real (non-financial) sector of the economy: the production function, the labor supply function, and the capital supply function, which set the trend for the growth of the country's production potential. When studying these models, the answer to the question is sought: how to ensure aggregate demand at the level of the economic growth trend?
Since the object of study is changes in economic indicators over time, the model parameters turn out to be functions of time. In those equations where all parameters refer to the same time period, the time period index t does not apply.
Modern models of economic growth were formed on the basis of two directions - the Keynesian theory of equilibrium and the neoclassical theory of production.
The simplest models of economic growth by R. Harrod (1939) and E. Domar (1947) built independently of each other, which correspond to the Keynesian concept of the functioning of the national economy ( neo-Keynesian). They are based on the premises:
1) the growth of national income is a function of capital accumulation only, and all other factors affecting the growth of capital productivity (the degree of use of the achievements of scientific and technical progress, improvement in the organization of production) are excluded. In other words, it is assumed that the demand for capital at a given capital intensity depends only on the rate of growth of national income;
2) capital intensity does not depend on the ratio of prices of production factors, but is determined only by the technical conditions of production.
Domar model – mathematical model economic growth, which describes the dual role of investment in expanding aggregate demand and in increasing the productive capacity of aggregate supply over time.
In a formalized form, the E. Domar model is an equation:
or 
,
where I– annual net investment; k- return on capital (i.e.).
This model calculates net investment growth rate which provides full employment in the economy.
Harrod model is a mathematical model of economic growth that focuses on the rate at which national income must increase in order to satisfy the Keynesian equilibrium condition. economic theory.
R. Harrod's model is based on the Keynesian condition of macroeconomic equilibrium. It uses two formulas - the condition of static equilibrium and the condition of dynamic equilibrium.
,
where is capital intensity; is the share of savings in national income.
,
where t– time period index.
In this model, the increase in national income in the period t- this is guaranteed growth rate, which provides a dynamic balance between actual savings and estimated investment. It is not achieved automatically, therefore, in order to achieve such a dynamic balance, state regulation of the economy is necessary.
These models are largely theoretical and abstract in nature; reflect the most general dependences of the production process: between accumulation, consumption, and the rate of growth of the social product (national income) with the organic composition of capital unchanged.
The post-Keynesian direction (J. Robinson) based its analysis of the theory of economic growth on the idea that the growth rate of the social product depends on the distribution of national income. In this case, the distribution is a function of capital accumulation, and the rate of its accumulation determines the rate of profit and its share in the national income.
The neoclassical direction is based on the idea of self-regulation market system and its optimality, expressed in the most efficient use production factors. Neoclassical models of economic growth are based on the use of the Cobb-Douglas production function. As noted above, they also include STP among the factors of economic growth. In this regard, a production function is distinguished with an exogenous and endogenous NTP factor.
In the first case, because STP occurs in time, a time factor is introduced into the Cobb-Douglas production function, taking into account the rates of STP ( J. Tinbergen function, 1942):
,
where r– growth rate of scientific and technical progress; t- time.
"Endogenous scientific and technical progress" is manifested in a change in the ratio between labor and capital. It is assumed that these factors of production are interchangeable, which leads to the need to calculate the elasticity of substitution of these factors. It indicates the percentage change in capital costs when labor costs change by 1%.
Solow model(19167) - a model of economic growth depending on the level of technical progress. This model uses a production function in which output is a function of capital and labor. Capital can be replaced by labor, but these factors are not perfectly interchangeable.
This model is characterized by the system of equations:
Y = f(K, L) is a production function with two variables.
S=APS*Y is the savings function of the national income.
∆I = ∆K– net investment (capital gain).
I=S is the rule of balance.
L = L 0 e t – labor resources are increasing at a constant pace.
∆Y/∆K = W- the wage rate is equal to the productivity of an additional unit of labor.
The natural growth rate is the increase in the labor force. If the supply of labor has increased as a result of natural increase of the population, then with the previous structure of labor and capital, part of the labor force will remain unemployed. However, unemployment leads to lower wages, and entrepreneurs are already choosing a combination of resources with relatively less use of capital, thus restoring the equilibrium.
A specific combination of labor and capital, in accordance with the production function, determines the level of total income, and this, in turn, determines the amount of savings. Since, in equilibrium, savings are equal to investments, which are identical to capital gains, the economy will move to a new state. Thus, a new cycle of economic growth will receive an impetus from the natural increase in labor resources.
This classical model asserts that not only is there the possibility of equilibrium economic growth - the development of the economy at full employment and the equality of aggregate demand to aggregate supply - but also that this state is sustainable. When deviating from the equilibrium state, the mechanism of interchangeability of factors of production comes into play, capable of restoring the equilibrium.
All models of economic growth allow for its effective forecasting, which makes it possible to more purposefully carry out public policy regulation of the economy.
COURSE WORK
On the topic: “Economic growth and its models”
Is done by a student:
facultyrecord book number
(Full name.)Scientific adviser:
(Full name.)| INTRODUCTION | 3 |
| 1. BASIC PROVISIONS OF THE THEORY OF ECONOMIC GROWTH. | |
| 1.1 Concept of economic growth | 5 |
| 1.2 Types of growth | 5 |
| 1.3 The issue of pace | 6 |
| 8 | |
| 2.1 Resources for economic growth | 8 |
| 2.2 Multi-factor model of economic growth | 9 |
| 2.3 Two-factor model of economic growth | 11 |
| 3 . CYCLE OF ECONOMIC DEVELOPMENT | 14 |
| 3.1 The essence of cyclicity | 14 |
| 3.2 Types of cycles | 14 |
| 3.3 Long waves Kondratiev | 15 |
| 3.4 Cyclicity as a deviation from equilibrium and as a form of equilibrium. | |
| 4. MODEL OF THE INTER-BRANCH BALANCE OF THE NATIONAL ECONOMY V. LEONTIEV. | 18 |
| 4.1 Universal models of economic growth | 18 |
| 4.2 Input-output model | 19 |
| 5. REAL MODELS OF ECONOMIC GROWTH | 21 |
| 5.1 Keynesian models | 21 |
| 5.2 Domar model | 21 |
| 5.3 Harrod's model | 22 |
| 5.4 Neoclassical models | 23 |
| 5.5 Production function | 23 |
| CONCLUSION | 25 |
| LIST OF USED LITERATURE | 28 |
| APPENDIX | 29 |
INTRODUCTION
The parameters of economic growth and their dynamics are widely used to characterize the development of national economies and in state regulation of the economy. The population evaluates the activities of the highest economic and political bodies of a country (for example, parliament, President, Government Russian Federation) primarily on the basis of consideration of indicators of the dynamics of economic growth, the dynamics of the standard of living. Economic growth, its pace, quality and other indicators depend not only on the potential national economy but largely on foreign economic and foreign policy factors.
The relevance of the chosen topic is obvious, because Russia now has an acute need to increase the rate of economic growth due to the backwardness of the national economy. Finding ways to achieve it is one of the priority problems for our country.
The object of study in this paper is economic growth as a category of economic theory.
The subject of the study is the types, factors and models of economic growth.
The purpose of my research, I believe, is to reveal the essence of economic growth and to study the whole range of views of economists on the problem of economic development.
To achieve the goal, it is supposed to solve the following tasks:
- in the theoretical part:
1. Reveal the essence, types and factors of economic growth
2. Study models and resources for economic growth.
3. Reveal the essence of the cyclical nature of economic development and the types of cycles.
- in the analytical part:
1. Consider in detail the views of various economists.
2. To study the model of intersectoral balance of the national economy by V. Leontiev
3. Consider real models of economic growth.
1. BASIC PROVISIONS OF THE THEORY OF ECONOMIC GROWTH.
1.1 Concept of economic growth
Economic growth is commonly understood as an increase in the volume of certain period goods and services, In some cases (for example, now in Russia), the increase may have a negative sign, which means a drop in production. Economic growth is usually measured relative to the previous period as a percentage or in absolute terms. In the case of single-product production, measurement in physical units may take place. The ultimate goal of economic growth is consumption, the growth of wealth. Their performance is discussed above. In our country, for a long time, a significant part of the resources, to the detriment of the interests of the people, was directed to the needs of the army, the military-industrial complex and unjustified socio-economic projects, which caused damage to the domestic economy that was difficult to eliminate. At the same time, the increase in the production of the military-industrial complex accounted for a significant part of the increase in national production.
1.2 Types of growth
World economic history knows two main types of economic growth. First, it is an extensive type. Its essence lies in the fact that the increase in the national product is carried out by attracting additional factors of production. Secondly, intensive economic growth, which is carried out through the use of more advanced factors of production and technology, i.e. through NTP. The result of intensification can be not only an increase in the volume of production, but also an increase in its quality.
Economic history does not know an intensive or extensive type of economic growth in its purest form. There is always predominantly intensive or extensive economic growth. The assignment of economic growth to one type or another is carried out depending on the value of the specific weight of the increase in production, obtained due to a qualitative or quantitative change in its factors. In the 70-80s. the growth of the national income of the USSR only by 20-30% was ensured by intensive factors. The corresponding figure for industrialized countries was over 50%.
1.3 The issue of pace
Another classification of economic growth is also possible: according to the magnitude of its rates. What pace is best? At first glance, the answer is simple: it is better to have high rates. In this case, society will receive more products and it will have more opportunities to satisfy its needs. But there are two things to keep in mind when answering this question. First, what is the quality of the products. One can hardly rejoice if the increase in the output of, say, color TV sets is achieved at the expense of devices, which then appear in the acts of the fire inspection as the cause of the fire. Secondly, the structure of production growth is important. If it is dominated by capital goods and, accordingly, the share of goods for the population is insignificant, then this is not good for the people. AT former years in our country, the share of military equipment in the increase in production was large. Therefore, although the volume of production increased, standard of living people decreased or grew slightly. The détente of international tension makes it possible to solve the problem of the demilitarization of the economy and the improvement of people's lives.
Consider the option of zero economic growth rates. For a relatively short time, it does not threaten with large negative consequences, since it can be carried out by reducing material consumption, increasing capital productivity and labor productivity. Another variant is also possible, when, as a result of reducing the cost of militarization, it is possible to reduce the output of military products.
As for the negative rates that are taking place in Russia at the present time, this is evidence crisis processes in the national economy of the country. The decline in the rate of economic growth in our country, which began in the 1960s, is explained by a number of circumstances. Firstly, the high proportion of production, means of production and the huge amount of military equipment produced, the elimination of which today has to spend a lot of money. Secondly, the deterioration of the return on assets, i.e. removal of products from a unit of production assets. Thirdly, since the lion's share of production was directed to military needs, there was an ever-increasing lack of engineering products to upgrade existing production, which was aging morally and physically, losing its productivity and other necessary properties. Fourthly, this process intensified sharply, the pace became negative in the 1990s due to the collapse of the USSR and the rupture of decades of established economic ties between enterprises located in various union republics. This was superimposed on the difficulties of transition to a market economy.
In the future, when the crisis of the Russian economy is overcome and the country moves on to normal development, the question of optimal rates of economic growth will arise. It seems that the optimal pace should be based on the current macroeconomic balance national economy and at the same time act the most important means its provision. They cannot be too high, because excessively high rates of development, as macroeconomics proves, inevitably lead to inflation. In general, it should be noted that this problem has not yet been developed in economic theory.
When assessing economic growth, its dynamics, rates and other indicators throughout the world (since 1993 and in the Russian Federation), the system of national accounts approved by the UN bodies should be used.
To assess economic growth, such well-being indicators as life expectancy, the amount of free time, etc., are becoming increasingly important.
2. MODELS OF ECONOMIC GROWTH
2.1 Resources for economic growth
The main factors (resources) of economic growth include labor, land, and capital. In turn, each of them is a set of “second order” factors. Thus, capital is buildings, structures, equipment, raw materials, fuel, etc., which affect the generated GNP to varying degrees. STP can also be attributed to capital, the impact of which on the size and structure of GNP is constantly increasing. Certainly, among external factors economic growth should also include the aggregate demand of society, because it is he who acts as the “main locomotive” of economic growth, both in quantitative and structural and qualitative aspects. Obviously, all factors, with the exception of aggregate demand, are supply factors.
