Solow growth model

E391913

The Solow growth model is a foundational economic framework that explains long-run economic growth through capital accumulation, labor or population growth, and exogenous technological progress.

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Predicate Object
instanceOf economic growth model
macroeconomic model
neoclassical growth model
assumes closed economy in basic version
competitive markets
constant returns to scale production function
diminishing returns to capital
exogenous population growth
exogenous savings rate
exogenous technological progress
classification exogenous growth model
coreVariable capital stock
labor
output
technology level
describes long-run economic growth
distinguishes growth from factor accumulation
growth from technological progress
explains role of capital accumulation in growth
role of exogenous technological progress in growth
role of labor growth in output growth
feature capital deepening
capital widening
golden rule level of capital
field economic growth theory
macroeconomics
hasExtension Solow model with government
Solow model with human capital
linked to: Solow growth model

open-economy Solow model
implies diminishing marginal product of capital
long-run growth in output per worker driven by technology
influenced endogenous growth models
modern growth theory
policy analysis on savings and investment
introducedBy Robert M. Solow
linked to: Robert Solow
introducedIn 1956
namedAfter Robert Solow
oftenUses Cobb–Douglas production function
predicts convergence in income per capita under certain conditions
existence of steady-state capital per worker
existence of steady-state output per worker
transitional dynamics toward steady state
publication A Contribution to the Theory of Economic Growth
linked to: Solow growth model
publicationYear 1956
usedFor analyzing effects of savings rate changes
analyzing population growth effects on income per capita
cross-country income comparisons
growth accounting
uses aggregate production function

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Referenced by (12)

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Introduction to Modern Economic Growth topic Solow growth model
Kaldor growth model contrastsWith Solow–Swan growth model
linked to: Solow growth model
Kaldor’s stylized facts of economic growth relatedConcept Solow‑Swan model
linked to: Solow growth model
Robert Solow familyName Solow
linked to: Solow growth model
Robert Solow notableWork Solow–Swan growth model
linked to: Solow growth model
Robert Solow notableWork Solow growth model
Robert Solow notableIdea Solow residual
linked to: Solow growth model
Robert Solow theoryDeveloped Solow–Swan growth model
linked to: Solow growth model
Ramsey–Cass–Koopmans model contrastsWith Solow–Swan model
linked to: Solow growth model
Solow growth model publication A Contribution to the Theory of Economic Growth
linked to: Solow growth model
Solow growth model hasExtension Solow model with human capital
linked to: Solow growth model