Answer to Question #58373 in Economics for sthiti pragyan tripathy

Question

what is meant by multisector growth model?explain their role in economic planning?explain in brief the basic structure of a shape of a simple multi sector growth model?

Answer 1

A multisector model is used primarily to study the allocation of resources across different economic activities. Some of the most exciting work being done with multi-sector models is in the economic theory of growth and development. The duality between growth models and dynamic general equilibrium models renders the multisector growth model ideal for the analysis of efficient intertemporal resource allocation. This includes renewable and non-renewable natural resources, produced resources such as capital, and land and labour resources. Growth models have been widely used in business cycle theory and in asset pricing theory. They have also been applied to the optimal management of dynamic ecological systems that have an economic component as a part of a complex systems model.