ABSTRACT
Capital accumulation is sufficient only to increase the country's stock of capital in the same ratio as that of the increase in the workforce. In other words, capital accumulation is the vehicle for technological progress. Where technical change is embodied in capital equipment, a country's rate of capital accumulation is all important since, in general, the more investment is undertaken the greater the degree of technological progress. Acceleration in technical progress or the emergence of a major innovation in a stream of minor ones is bound to increase capital requirements in advance of output and consequently disturb the existing equilibrium between savings, income and the rate of capital accumulation. There seems to be no reason to doubt that the nineteenth century witnessed a genuine rise in the level of thrift. This is apparent in the gradual acceleration in the rate of capital accumulation throughout the period.
