Chap. 3 - Long Run Economic Growth

Question 1

What is Economic Growth?

Answer 1

Economic growth is usually defined in terms of an increase in either GDP or per capita GDP. In order for there to be economic growth, the GDP must be growing at a faster rate than the population.

Question 2

What is the Classical Economic Growth view?

Answer 2

That the growth in per capita GDP is transitory and if standards of living rose above subsistence levels people would be enticed to have more kids, and eventually return to a subsistence living standard.