G(y) = Ay½and that y(G) = By with A = 100 and B = 1. What would be the level of income in this country?Now, say that the institutions view holds and that institutions improve. Specifically, the...

G(y) = Ay½and

that y(G) = By with A = 100 and B = 1. What would be the level of income in

this country?Now, say that the institutions view holds and that institutions

improve. Specifically, the relevant constant grows (A or B) grows by 10%. What

is the new value of y?

Consider two countries which we’ll call X

and Y. Say that (AX/ AY) = 2 and that country X is 20

years ahead technologically of Y and that technology grows at 1.1% a year. What

dominates the productivity differences – technology or institutions?