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suppose we have two economies- lets call them earth and mars- that are identical, except that one begins with a stock of ideas that is twice as large as the other. A/Earth0=2* A/Mars0. the two economies are so far apart that they don't share ideas and each evolves as a separate romer economy. on a single graph( with a ratio scale), plot the behavior of per capita GDP on earth and mars over time. what is the effect of starting out with more knowledge?

Microeconomics, Economics

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