The Causes of Economic Growth

    0
    68

    The Causes of Economic Growth

    • In the short run, if an economy’s operating with spare capacity, economic growth can occur due to an increase of AD
      • This can be things like consumption lead growth, export lead growth, etc.
    • Net investment has a different effect on economic growth, as it not only increases AD, but AS as well
      • This enables long-run economic growth, as the productive capacity of the economy’s increased.
    • The essential causes of long-run economic growth are the increases in the quantity and/or quality of resources.
      • The main causes of an increase in the quality of an economy’s resources are advances in technology and improvements in education and training.

    LEAVE A REPLY

    Please enter your comment!
    Please enter your name here