Consider the economies of Blahnik and Tralfamadore, both of which produce gobs of goo using only tools and workers. Suppose that, during the course of 50 years, the level of physical capital per worker rises by 5 tools per worker in each economy, but the size of each labor force remains the same. Complete the following tables by entering productivity (in terms of output per worker) for each economy in 2016 and 2066.
Blahnik
Year Physical Capital Labor Force Output Productivity
(Tools per worker) (Workers) (Gobs of goo) (Gobs per worker)
2016 11 30 1,800
2066 16 30 2,160
Gribinez
Year Physical Capital Labor Force Output Productivity
(Tools per worker) (Workers) (Gobs of goo) (Gobs per worker)
2014 8 30 2,400
2024 12 30 3,600
Initially, the number of tools per worker was higher in Blahnik and Gribinez. From 2014 to 2024, capital per worker rises by 4 units in each country. The 4-unit change in capital per worker causes productivity in Blahnik to rise by aamount than productivity in Gribinez. This illustrates the concept of, which makes itor countries with low output to catch up to those with higher output.