How Potential GDP Grows

When there is an increase in real GDP, one can find the presence of economic growth. However, we cannot state recovery from a recent recession or a sudden increase in real GDP to be an economic growth.

What we understand from potential GDP is a sustainable economic growth where the hike continues year after year without fail.

Now, 2 important questions in this respect are:

• What are the aspects that regulate this potential GDP?
• What are the factors that help in its growth?

Links of Previous Main Topic:-

• Definition of Economics
• Economic Problem
• Market Equilibrium
• Employment and Unemployment
• Economic Growth Macroeconomics
• The Basics of Economic Growth

Links of Next Macroeconomics Topics:-

• Why Labor Productivity Grows
• Preconditions for Labor Productivity Growth
• Physical Capital Growth
• Human Capital Growth
• Technological Advances
• Growth Theories Evidence and Policies
• Classical Growth Theory
• Neoclassical Growth Theory
• New Growth Theory
• New Growth Theory Versus Malthusian Theory
• Sorting Out the Theories
• The Empirical Evidence on the Causes of Economic Growth
• Economic Growth Macroeconomics
• Policies for Achieving Faster Growth
• The Exchange Rate and the Balance of Payments
• The Dollar and Carry Trade
• Expenditure Multiplier Know the Keynesian Model