Now that we have considered human and physical capital, let's turn to the impact of technology on real income per worker.
According to the description in EBE 6, each country's measure of technology is:
A.
Inferred or calculated by assuming that any GDP that can't be accounted for by physical capital or labor in the aggregate production function is accounted for by technology.
B.
Assumed to be the same.
C.
Observed directly from data on research and development.
Exhibit 6.12 demonstrates the importance of a country's stock of knowledge and technology on its productivity. However, we need to take care in drawing firm conclusions because:
▼
True
False
1.
Measures of human capital are estimates and years of school may not accurately capture the important aspect of worker skill.
▼
False
True
2.
Years of school is guaranteed to result in the same worker skill in different countries.
▼
True
False
3.
If years of schooling underestimate human capital, then less real income per worker is attributed to human capital and more to technology.
▼
False
True
4.
If years of schooling overestimate human capital, then less real income per worker is attributed to human capital and more to technology.