Endogenous Growth Theory
Endogenous Growth Theory is an economic theory that explains how economic growth is driven by internal factors rather than external influences. It emphasizes the role of technology, innovation, and human capital in fostering growth. According to this theory, investments in education and research can lead to increased productivity and sustainable economic development.
This theory contrasts with traditional growth models, which often attribute growth to external factors like capital accumulation. By focusing on the importance of knowledge and skills, Endogenous Growth Theory suggests that policies promoting education and innovation can significantly enhance a country's long-term economic performance.