Cross Country Comparisons In this section, we'll enrich our study of income levels across countries. Here, we'll get acquainted with cross-country data that the Solow Growth model can speak to. You should look at the US and two (any) other countries. It'll work better if the two countries are poorer than the US. For data, look at the Penn World Table here: https://febpwt.webhosting.rug.nl/Home

then click "Thematic select" on the right panel of the site. ,

1. Using the Penn World Tables download the series for GDP, labor and capital stock. For GDP and capital stock, use "constant 2017 national prices," and for labor use "persons engaged." Compute GDP per worker Y /L and plot the difference between the US and the other countries. What about capital per worker, K/L?

2. For as far back as you can go, plot the capital-output ratio, Y /K for each country. What's been the trajectory for the US? For the other countries?

3. Plot the change in natural log for each of these over time, i.e. log xt+1 ? log xt for x = Y, L, K. Now try computing the growth rates for each, xt+1 xt ? 1. Similar, right!?

4. Consider the production function Y = AK?L 1??, converting this into per worker terms, we get Y /L = y = AK?L 1?? L = Ak?. In a given year, we then have y k? = A. Compute this for each country using ? = 0.5. What do you notice about differences in A? Do richer places have higher or lower A?

Cross Country Comparisons In this section, we'll enrich our study of income levels across countries. Here, we'll get acquainted with crosscountry data that the Solow Growth model can speak to. You should look at the US and two (any) other countries. It'll work better if the two countries are poorer than the US. For data, look at the Penn World Table here: https://febpwt.webhosting.rug.nl/Home then click \"Thematic select\" on the right panel of the site. , 1. Using the Penn World Tables download the series for GDP, labor and capital stock. For GDP and capital stock, use \"constant 2017 national prices,\" and for labor use \"persons engaged.\" Compute GDP per worker Y/ L and plot the difference between the US and the other countries. What about capital per worker, K/L? 2. For as far back as you can go, plot the capital-output ratio, Y/K for each country. What's been the trajectory for the US? For the other countries? 3. Plot the change in natural log for each of these over time, i.e. log $34.1 log 33,3 for a: = Y,L,K. Now try computing the growth rates for each, \"\"1 1. Similar, rightl? mt 4. Consider the production function Y : AKQL1_\