Assume that the two countries have labor forces of equal size. a. Using this function, solve for
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Assume that the two countries have labor forces of equal size.
a. Using this function, solve for the steady-state ratio of technology in the leading country to technology in the follower country (i.e., A1/A2) as a function of the values of gA in the two countries. Show how this depends on the value of
b, and explain what is going on.
b. Assume that b = 1/2, mi = 10, gA,1 = 0.2, and gA,2 = 0.1. Calculate the steady-state ratio of technology in Country 1 to technology in Country 2.
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