US Economic Growth in Retrospect and Prospect
This chapter presents another view of the major factors affecting US economic growth both historically and prospectively. The Hickman—Coen (HC) annual growth model is used to investigate the determinants of economic growth and productivity change during 1956–1982 and to forecast the principal macroeconomic variables for 1985–2000. Our approach stresses the interaction of aggregate supply and demand in the growth process instead of concentrating exclusively on reduced-form analysis of the production function. It leads to a different view of the driving forces of economic growth, as summarized in the concluding section.
KeywordsTotal Factor Productivity Labor Force Participation Real Wage Technical Progress Aggregate Demand
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