The difference between total factor productivity (TFP) in the Solow model and the stock of ideas in the Romer model is that:

Question

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In the Solow model, TFP is assumed to be fixed and determined by exogenous factors such as technology and institutions. On the other hand, in the Romer model, the stock of ideas is endogenous and can grow through investment in research and development. Therefore, the key difference between the two models is that TFP is fixed while ideas can grow.

The Difference Between Total Factor Productivity (TFP) in the Solow