Other things equal, how do relatively poor countries tend to grow?
A)slower than relatively rich countries; this is called the poverty trap
B)slower than relatively rich countries; this is called the Malthus effect
C)faster than relatively rich countries; this is called the catch-up effect
D)faster than relatively rich countries; this is called the constant-returns-to-scale effect

Question

Quizplus · Accepted Answer

The catch-up effect suggests that relatively poor countries can grow faster than relatively rich countries as they have the potential to adopt and replicate technologies and practices developed by richer countries, and thus catch up to their level of productivity and output. This can result in a faster pace of economic growth.

Other Things Equal, How Do Relatively Poor Countries Tend to Grow