If endogenous growth models are correct,a lower rate of growth in the long run could occur as a result of which of the following?
A)a lower rate of saving
B)a lower rate of depreciation
C)a redefinition of depreciation
D)a redefinition of the steady state
E) none of the above

Question

Quizplus · Accepted Answer

Endogenous growth models emphasize the role of knowledge, human capital, and technological progress in driving long-run economic growth. In these models, a lower rate of saving would reduce the amount of investment in physical and human capital, which could subsequently result in lower productivity growth and a lower rate of long-run economic growth. Choices B, C, and D are not directly related to endogenous growth models or their predictions about the determinants of long-run growth. Therefore, the best choice is A.

If Endogenous Growth Models Are Correct,a Lower Rate of Growth