ch. 23 New Growth Theory
About this set
Created by:
hannahcohen on February 15, 2010
Subjects:
Log in to favorite or report as inappropriate.
Order by
6 terms
Terms | Definitions |
|---|---|
 New Growth Theory | real GDP per person grows because of the choices people make in the pursuit of profit and that growth can persist indefinitely |
| discoveries result from and bring | choices/profit |
| competition then destroys | the profit |
| The ability to innovate means | new technologies are developed and capital accumulated as in the neoclassical model. The production function shifts upward. Real GDP per person increases |
| The pursuit of profit means | more technological advances occur and the production function continues to shift upward. Nothing stops the upward shifts of the production function because the lure of profit is always present |
| The ability to innovate determines how | capital accumulation feeds into technological change and the resulting growth path for the economy. Productivity and real GDP constantly grow |
First Time Here?
Welcome to Quizlet, a fun, free place to study. Try these flashcards, find others to study, or make your own.