EC202 1nd Edition Lecture 41Outline of Last Lecture I. Impressive growthII. Compound interest rateIII. Average labor productivityOutline of Current Lecture II. Human capitalIII. Physical capitalIV. Technology Current Lecture-human capital-Human capital is similar to physical capital in that it is -Acquired through the investment of time, energy, and money-Acquired through going to school to learn new skills-Greater human capital results in higher productivity-Physical capital: Tools people have to work with (e.g., machines, factories)-More and better physical capital allows workers to produce more efficiently-other resources-Land and other natural resources-Land, energy, and raw materials-Fertile land-Modern manufacturing processes intensively using energy and raw materials-Many natural resources can be obtained through tradeThese notes represent a detailed interpretation of the professor’s lecture. GradeBuddy is best used as a supplement to your own notes, not as a substitute.-petroleum, minerals, ores-technology-Ability to develop, and apply new, more productive technologies will increase productivity-Internal combustion engine -New technologies can improve productivity in industries other than the one in which they are introduced-New technologies are the single most important source of productivity improvement-New scientific knowledge leads to widespread improvements in living standards only when it is commercially applied-New technology needs an economic system that makes benefits of the advances available to the average
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