What was the growth rate of GDP per worker

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Reference no: EM13860644

Botswana is one of the few economic success stories in Africa. While still plagued with many problems (e.g. one of the highest rates of AIDS infection in the world), it has managed to transform itself among the poorest countries to a middle income country in just a generation. The growth rate of real GDP (%ΔY) in Botswana in 2002 was estimated at 4.2%, and labor growth rate (%ΔL) was actually negative, at -0.55%.

a. What was the growth rate of GDP per worker in Botswana in 2002? Per worker GDP growth, % Δ(Y/L) is given by %ΔY - %ΔL. In this case, that comes out to be 4.2 - (-0.55) = 4.75%.

is this ^^ right?

Compare Botswana with one of its neighbors, Zambia. The average savings rate in Botswana and Zambia between 1960 and 1999 was about the same, around 15%. Yet, Botswana has achieved a much higher average rate of growth in GDP per worker over this period.

B. Using one of the growth accounting equations, provide a reason why Botswana has grown so quickly

Reference no: EM13860644

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