Chapter 13 Why Do Economies Grow?

| November 9, 2018

28)
Education is an integral part of economic growth.

29)
Human capital is equally, if not more, important than physical capital.

30)
All growth theory today is “new growth theory” because it considers a
broad framework that includes technological progress.

31)
Suppose you were interested in increasing technological progress in your
country. Suggest some ways to do it.

32)
What are the trade-offs involved in shortening the length of a patent for
pharmaceuticals?

33)
In what two ways can education contribute to economic growth?

13.5 A Key Governmental Role: Providing the
Correct Incentives and Property Rights

1)
Economic growth is severely impeded in economies
A)
with a lack of clear property rights.
B)
with a strong market system.
C)
with high rates of convergence.
D)
which encourage induced innovation.

2)
The absence of clear property rights
A)
is caused by capital deepening.
B)
is common in many developing nations.
C)
encourages creative destruction.
D)
all of the above

3)
Which of the following is the best example of a person NOT having clear
property rights?
A)
a city parks worker who inherits his uncle’s town house
B)
a dairy farmer who pays off the mortgage on his farm
C)
a medical student who lives on campus for his first year of studies
D)
a retired college professor who builds a bungalow on her oceanfront property

Recall
the Application about the lack of property rights in Peru, and why clear
property rights are important for economic growth in developing countries, to
answer the following question(s). Clear property rights give owners an
incentive to make long-term investments in their property, and are vital for
the property owners to be able to borrow funds.

4)
Recall the application. Clear property rights
A)
are important for economic growth in developed nations, but not in developing
nations.
B)
hinder economic growth in developing nations.
C)
have no impact on the economic growth of developed nations.
D)
are important for economic growth in developing and developed nations.

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