ABSTRACT
The differences in the capital formation proportions are quite small: the share of net capital formation in net national product in groups I and II exceeds that in group vn by 8 per cent of national product, and the range for the share of gross capital formation in gross national product is about 10 per cent of gross national product. Is it plausible to assume that these few additional percentage points account for the striking differences in levels of performance and patterns of growth that we observe between the developed and the underdeveloped economies? Of course, one could reply in terms of the old parable that for want of a horseshoe nail, a kingdom was lost; I must confess, however, to a strong intuitive objection to such a theory of history or of economic growth that puts its faith in the strategic importance of minor details.
