The sources of growth equation decomposes the rate of growth of real output into:

Question

Quizplus · Accepted Answer

The sources of growth equation, often associated with the Solow growth model, indeed decomposes the rate of growth of real output into the rate of growth of technology (total factor productivity), capital's share of income times the rate of growth of the capital stock, and labor's share of national income times the growth of labor. This reflects how increases in output can be attributed to increases in inputs (capital and labor) and improvements in the efficiency of using these inputs (technology).

The Sources of Growth Equation Decomposes the Rate of Growth