"Romer's model of endogenous growth" Consider Romer's model of endogenous growth.
a). Suppose first that the production function is as follows:
where α = 0.1 and β = 0.
Using the equation in the text, what will be the growth rate of per capita income? In such a situation, under what circumstances might per capita income growth be increased?
b). Suppose instead that with the same production function α = 0.1 and β= 1.1. Once again using the equation in the text, what will be the growth rate of per capita income?