Who Benefits Capital Deepening? Capital deepening increases the marginal product of labor – i.e., it makes labor more productive (because there are now more units of capital per worker). Capital deepening typically increases output through technological improvements (such as a faster copier) that enable higher output per worker. Is capital deepening good or bad? Historically,
What Is An Example Of Capital Deepening? An increase in capital per hour (or capital deepening) leads to an increase in labor productivity. For example, consider factory workers in a motor vehicle plant. If workers have increased access to machinery and tools to build vehicles, they can produce more vehicles in the same amount of
Why Is The Savings Rate Important For Capital Deepening? income spent to income saved is called the savings rate. invest, money in banks, their money becomes available for firms to borrow or use. This allows firms to deepen capital. What affects capital deepening? Capital deepening increases the marginal product of labor – i.e., it makes
Which Of The Following Is The Process Of Increasing The Amount Of Capital Used Per Worker? Capital deepening refers to an increase in the amount of capital per worker, either human capital per worker, in the form of higher education or skills, or physical capital per worker. What increases capital per worker? Capital deepening increases