Economics Answers

Assume in country A the rate of return to capital is 4% and the real growth rate of the economy is 3%. Assume in country B the rate of return to capital is 5% and the real growth rate of the economy is 6%. According to Piketty, which country is more likely to have persistent inequality in wealth? Explain.

According to Autor, Katz, and Kearney, do you think economists will be harmed by or benefit from future skill biased technology change? Explain.

Describe three reasons why earnings income inequality has risen for men since the 1970’s.

Basing your answer on the work of Kopczuk, Saez, and Song, how has the earnings inequality of men change since World War II (note that the different trends in different time periods)? Since the 1970’s how did the trends in earnings inequality differ for men in the top half of the distribution and the bottom half of the distribution?

Assume country A has a Gini coefficient of 0.4 and a Shorrocks measure of mobility of .8. Country B has a Gini coefficient of 0.3 and a Shorrocks measure of mobility of .4. Which country has a more serious problem with income inequality? Justify your answer.

Explain why James Heckman would argue that it would be preferable to institute a universal preschool program than a program reducing college tuition. Your answer should include evidence regarding the rate of return from both investments and discussion of credit constraints for higher education.

Because of the pandemic on-campus instruction was replaced by online instruction. Assume that the online instruction is less effective than the on-campus instruction but that students were more likely to successfully complete courses because all exams were open-book. Contrast what human capital theory and signaling theory would predict regarding how future earnings will be affected by the way courses were taught.

Assume that in country A college tuition is $10,000 per year, citizens save 5% of their income for retirement, and there is a mandatory retirement age of 60 years old. In country B, the tuition for college is $5,000 per year, citizens save 10% of their income for retirement, and there is no mandatory retirement age. According to human capital theory, in which country will citizens be more likely to go to college? Explain how the presented facts determined your response.

THIS IS A LONG RUN QUESTION; take your calculations to three (3) decimal places. You manage a dog-walking business. You have 2 inputs, "experienced dog-walkers" and "intern dog-walkers". Your output is “dogs walked”. Your experienced walkers are able to walk more dogs per day than the interns can; the experienced walkers each walk 12 dogs a day, so the MPEXPERIENCED is 12. Intern walkers each walk 8 dogs a day, so the MPINTERNS is 8. The experienced walkers are paid $80 per day and the intern walkers are paid $60 per day. You are currently using 3 of each, 3 experienced walkers and 3 interns. Which of the following is correct?

Consider this short run production function, similar to many we discussed in class:

Q = (-.05)*L3 + (2)*L2



What is the value of average product (AP) when you employ 30 workers?