Economic growth depends more on technological change than on increases on capital per hour worked.Question 36Answera.Trueb.False

Analyzing the Statement

1. Understanding Economic Growth: Economic growth is typically measured by an increase in the production of goods and services in an economy over a certain period. This growth can stem from various factors, including capital accumulation, labor force expansion, and technological advancement.

2. Role of Technological Change: Technological change can lead to greater efficiency in production processes, improve productivity, and foster innovation, ultimately contributing to economic growth.

3. Role of Capital Accumulation: Increases in capital per hour worked involve investing in physical assets like machinery, buildings, and infrastructure, which can also enhance productivity. However, additional capital without technological innovation may yield diminishing returns.

4. Dependence of Growth on Technological Change: Many economists argue that while capital is essential, technological change is often the more significant driver of sustained economic growth since it can create new methods and ideas that fundamentally transform productivity and output levels.

Conclusion

Considering the impact of both factors, the statement suggests that technological change is a more crucial determinant of economic growth compared to just increasing capital. Therefore, the statement is True.

Final Answer

a. True