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a. Use the law of motion for the capital stock (Kt+1 = stYt + (1 )Kt) in order to obtain estimates of the saving rate

a. Use the law of motion for the capital stock (Kt+1 = stYt + (1)Kt) in order to obtain estimates of the saving rate in all years.

Assume the Production function is of the form Y = AK^a(HL)^1-a, that the depreciation rate is 6% per year, and that a = 0.3.

year gdp population employment capital(K) education
1975 1323576 926.24088 419.7919 1718109 1.594199
1976 1272721 942.68541 431.8582 1848966 1.623609
1977 1364091 957.89127 442.6376 1981555 1.653562
1978 1573644 972.20544 454.2029 2145750 1.684067
1979 1653973 986.1322 467.5601 2309319 1.713661
1980 1678408 1000.0892 484.6689 2499968 1.737436
1981 1690708 1014.0222 504.6518 2676162 1.759069

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