Question

whether either type of Solow and Romer model can satisfactorily account for the slowdown in the growth of ouput per worker experienced by some advanced western economies since the onset of the Great Recession

Answer 1

After the great recession two eminent economists gave their own model on economic growth like Solow and Romer...

In the solow model output is divided into three parts

1) consumption per labour

2)capital widening i:e when k/L ratio is constant

3) capital deepining

Solow says if this happens them the economy will experience balance growth.

When all economic variable are changing at the same constant rate then there is a balanced growth...

Paul Romer

In this model technological progress is not endogenous. It has endogenised the technical progress, so it is called endogenous grotwh model.

Endogenous growth theory has simillaryt with solow but he has failed to failed to describe the technology as an endogenous variable

Technology is the stock of knowledge or stock of ideas extend over a peperi of time. There are differenc features idide

1) ideas are non rivalry

2) ideas are subjected to increasing return

3) The market for ideas has imperfect competition..