25 Solow & Excel

[@MarjanaAkterDolon]

can you make a video with an real life example by using country? like Japan, Germany e.t.c

[@joshuahill60]

I can. That, however, would be a nice way for you to see how well you understand the model. Basically, you could use a real world starting value for a country's GDP (i.e. Germany was 4.456 trillion USD last year, or 52,745 USD in per capita terms) and their savings rate (a quick web search says 20.5%). Maybe use depreciation of .02 like the textbook does, and an alpha of 0.25 to 0.35 would be reasonable based on historical and contemporaneous figures (though empirical estimates vary).

[@parsaseyedinik3051]

I'm using Microsoft excel and did the exact same thing, but my depreciation curve is not linear. How do i fix it?

[@joshuahill60]

I do not know off the top of my head. Your depreciation curve should equal the depreciation rate times K. Given that K is on the horizontal, the slope of your line will be the depreciation rate. My guess is that if you look at your depreciation line's function it will not be D = δK (where δ is a constant with a value between 0 and 1) but something involving Y (i.e. D = δY). If not, let me know and we can see about hunting down what's going on.

[@angelanju6713]

Hi. What is the name of the program you used?. Btw, Tx for the video

[@joshuahill60]

You mean Microsoft Excel? Or Apple Numbers? They’re pretty much the same.

[@joshuahill60]

And I’m glad you found it helpful.

[@joshuahill60]

I used Apple Numbers but you can do the same thing in MS Excel