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12 Cards in this Set
- Front
- Back
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production
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a process that transforms resources into goods and services.
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productivity
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ratio of total output to a specific measure of input.
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labor productivity
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output per unit of labor; measured as real GDP divided by the hours of labor employed to produce that output.
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per-worker production function
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the relationship btwn the amount of capital per worker in the economy and average output per worker.
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capital deepening
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an increase in the amount of capital per worker; one source of rising labor productivity.
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rules of the game
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formal and informal institutions that promote economic activity; laws, customs, manners, conventions, and other institutional elements that determine transaction costs and thereby affect people's incentive to undertake production and exchange.
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industrial market countries
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economically advanced capitalist countries of western europe, north america, australia, new zealand and japan, plus others
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developing countries
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countries with a low living standard b/c of less human and physical capital per worker.
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basic research
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the search for knowledge without regard to how that knowledge will be used.
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applied research
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research that seeks answers to particular questions or to apply scientific discoveries to devleop specific products.
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industrial policy
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the view that government-using taxes, subsidies, and regulations-shld nurture the industries and technologies of the future, thereby giving these domestic industries an advantage over foreign competition.
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convergence
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a theory predicting that the standard of living in economies around the world will grow more similar over time, with porrer countries eventually catching up with richer ones.
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