Ceteris paribus, an increase in labour productivity results in a

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An increase in labour productivity means that workers are producing more output per hour of work. This increased efficiency should lead to an increase in real wages because firms can afford to pay their workers more with the same level of output. Additionally, potential GDP per hour of labour increases because the same worker is now producing more output in the same amount of time, leading to a more productive economy overall.

Ceteris Paribus, an Increase in Labour Productivity Results in a