Physical Capital
The natural resources and geographical advantages which can be manufactured into commodities.
What is land?
Public works and public transportation that keep urban centers functioning smoothly.
What is infrastructure?
A way to improve human capital through making a country a good place to start a business.
What are good institutions?
Additions to the upper-class labor force besides natural population growth.
What are high-skilled immigrants?
CEOs and upper level executives earn 270 times more than their employees, the greatest disparity in modern history
What is income inequality?
The rapid increase in technological innovations for mechanical production that began in 1700s England.
What is the Industrial Revolution?
Investments in clean sanitation and disease prevention that protect the health of citizens and the functionality of cities.
What is Public Health?
How the government can use the legal system to make it easy to start a business.
What are property rights?
Additions to the labor force besides natural population growth. These people are often found working in agriculture or construction.
What are low-skilled immigrants?
When one citizen owns more stocks, bonds and houses than another citizen
What is wealthy inequality?
The transformation of human capital into physical capital.
What is automation?
Education, knowledge, welfare that improves the quality of the labor force
What is human capital?
The consistent functioning of the federal, state, and local governments uninhibited by coups and revolutions.
What is political stability?
This increases productivity by improving the quality and quantity of the workforce without the need for Pro-Natalist policies.
What is immigration?
When two citizens born in the same city, but different neighborhoods have an unequal chance of elevating themselves into the upper level income brackets
What is inequality of opportunity?
This displaces some workers in the short term, and creates new jobs in the long term.
What is structural unemployment due to automation?
How citizens gain technical knowledge and critical thinking skills to prepare them to contribute to the economy.
What is education?
Funding for corporations, universities, and non-governmental organizations to develop new technologies to improve the welfare of the public.
What is Research and development?
Where new technologies and innovations can be more widely spread and enjoyed among more people
What is a high population density?
When people born in different countries have vastly different projected lives. For instance, compare the life expectancy or GDP between the United States and Nigeria.
What is global inequality?
Each marginal increase in this thing will have less and less impact, thus requiring more investment in human capital.
What is Diminishing Returns of Physical Capital?
What tax rebates, light occupational licensing restrictions and loose zoning laws have in common
Government incentives
Laws like Dodd-Frank and Glass-Steagall that prevent the banks from taking advantage of their investors
What is regulation of the financial system?
The government lowers the cost of child raising through paying parents to have children, improving the quality of public education or a multitude of other ways
What are Pro-Natalist policies?
The theory that differences in real GDP per capita between countries narrows over time.
What is the convergence hypothesis?