What Is the Harrod-Domar Model?

The Harrod-Domar model is the "Harrod-Domar model" (Harrod-Domar model). R. Harold and E. Thomas separately developed the famous economic growth model in economics. The Keynesian theory, which appeared shortly after the Great Crisis of 1929-1931, is not an "orthodox" theory of economic growth theory, because the model concludes that "economic growth is unstable."

Harold-Domar Model

Right!

G = S / V

G is the economic growth rate and S is

Y / Y = s × Y / K

Among them: Y-output, Y-output change, Y / Y-economic growth rate; s-

Y / Y = I / Y × 1 / k = s / k

Model Hypothesis 1: Savings can be effectively transformed into investments;

Model Hypothesis 2: The country's foreign

Harold abstracts economic growth into three under the above assumptions

The model highlights

1. Hypothesis one and hypothesis two are mostly not available in developing countries.

2. Hypothesis VI ignores the huge role that technological progress plays in economic growth.

3. Hypothesis 5 negates the substitutability of factors of production and is unreasonable.