Endogenous growth theory is an economic theory that focuses on the drivers of economic growth within a country. The theory suggests that a country's ability to innovate and develop new technologies is a key driver of economic growth. Unlike traditional growth theory, which emphasizes the importance of capital accumulation and labor inputs in driving economic growth, endogenous growth theory argues that technological progress and knowledge accumulation are the primary drivers of economic growth. The theory suggests that education, research and development, and investments in human capital are critical factors that drive technological progress and innovation. By promoting these factors, policymakers can stimulate long-term economic growth and development.
The endogenous theory of growth is an economic theory that emphasizes the role of internal factors, such as human capital, technological progress, and innovation, in driving economic growth. Unlike the earlier neoclassical growth theory, which focused on external factors like capital accumulation, the endogenous theory argues that growth is not solely dependent on external factors and can be influenced by policies and actions at the individual, firm, and national levels. The theory suggests that investment in education, research and development, and infrastructure can stimulate innovation and productivity, leading to sustainable economic growth. Understanding the endogenous theory of growth involves examining how factors within a system interact and shape economic outcomes.
