The paper “ Factors of the State Long-Run Economic Growth” is affecting variant of the statistics project on macro & microeconomics. Economic growth is the backbone for prowess and high standards of living in a country. The long-run economic growth of a country defines its gross domestic profit. Various factors are attributed to driving forces for the vigorous economic growth in Australia. The Australian economy is compared to other countries to evaluate the trend in the economic growth of countries in the Organisation for Economic Co-operation and Development (OECD). The OECD countries are preferable because they have similar economic structures as Australia and the comparison is based on the common factors that influence each country’ s economy.
The purpose of the research is to show the growth of Australia economically compared to her counterparts in the same economic spectrum. The variables that influence the long-run growth of Australia and the selected countries are evaluated one by one to show their impact on long-run growth. Theory/ModelThe model used to evaluate variables for comparison is the Solow-Swan model that focuses on productivity growth. The model posits that productivity growth influences other vital macroeconomic theories that include labor, physical capital accumulation, and possibilities frontier of a county (Barro 1999, p. 104). The mathematical presentation of the model takes Y=ProductionF= coefficient of outputA= productivity parameterL= productivity parametera= 1/3Y= F (K, L) =-Ak1/3L2/3The macroeconomic theories are used as focus points for the comparison of Australia’ s long-run growth to other countries. Empirical FindingsLabour ProductivityThe models and theories of microeconomics are employed to explore the objective of this research and appraise the findings systematically.
The GDP in Australia has expanded consistently over the years with minor setbacks that the country managed to overcome.
The fourth quarter of 2013 saw the country’ s GDP increase by 2.8%. The annual GDP for Australia has been consistent since the 1960s maintaining a 3.48% rate from 1960 to 2013 (Trading Economics 2014, p. 1). The country’ s significant growth dates back to 1964 when Australia registered a 9% growth in its second quarter of 1964.
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