Ceteris paribus, an increase in labour productivity results in a

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An increase in labour productivity means that workers are able to produce more output per unit of time, which leads to an increase in potential GDP per hour of labour. As a result, the demand for labour increases, which puts upward pressure on the real wage rate. Therefore, an increase in labour productivity results in a higher real wage rate and higher potential GDP per hour of labour, ceteris paribus.

Ceteris Paribus, an Increase in Labour Productivity Results in a