Answer to Question #207248 in Macroeconomics for Corleze Joan Botha

Question

The chart below illustrates the cumulative confirmed deaths by COVID-19 just before what looks to be a potential third wave of the pandemic in South Africa. There have been 56 363 confirmed deaths in South Africa alone from COVID-19 as of 30 May 2021. Use specifically the Solow growth model to discuss the implications of this pandemic on the prospects of long-run economic growth for South Africa

Answer 1

The slow growth model aids in estimating economic growth by analyzing changes in output owing to changes in population growth rate and demographics, such as in South Africa, where the corona epidemic has resulted in 56,363 verified fatalities, affecting the country's demographic conditions.

As the population rate declines, savings diminish, production declines, and output declines due to a labor shortage, we might conclude that South Africa's long-term economic growth is likewise declining.