Using the standard solow growth model

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Using the standard Solow growth model (i.e., without technological change as graphed below), draw and describe the effects that war involving high casualties has on capital per worker. Assume this war occurs on foreign soil and thus does not damage the modeled country’s capital stock, which causes a short-run divergence from the steady-state. Based on your answer, is the Solow Model actually a model of growth (i.e., does it explain the secular change we see in Y over time)?

Reference no: EM13981007

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