A Dynamic Model of Regional Economic Growth

Abstract

The article is devoted to the construction of a dynamic model of economic growth Solow and Solow model taking into account the delay in the commissioning of assets for the Volga Federal District. We study and analyze the theoretical methods of investigation method of constructing such models and the urgency of the topic of research. To build the model were selected macroeconomic indicators such as gross regional product, the value of fixed assets, the labor force employed in the economy, the economically active population, the value of investments in fixed assets, consumption. On the basis of the constructed models were constructed projections of key macroeconomic parameters included in the model for 2013-2015. In order to assess the accuracy of the predicted values obtained by the Solow model, built four equations of various growth curves. It should be noted that these trend lines very well describe the gross regional product of the Volga Federal District. The best model is the polynomial trend line; the coefficient of determination is the maximum. Predicted values are similar between the Solow model and polynomial trend line. It is shown that elasticity of labor much more elasticity in terms of capital to the Volga Federal District, as a result, it is possible to make an unequivocal conclusion about the extensive nature of economic growth.

DOI: 10.5901/mjss.2015.v6n3s7p139