Economics · Solow Growth Model
According to Solow's growth model, if two countries have identical savings rates but one has a higher population growth rate, then in the long run:
Verified Solution4 OptionsUpdated: October 2026👁️1 View
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- 1Both will have equal per capita income
- 2The country with higher population growth will have lower per capita income✓
- 3The country with higher population growth will have higher per capita income
- 4Per capita income will be unaffected by population growth
Correct answer
The country with higher population growth will have lower per capita income
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