ABSTRACT

This chapter considers the rates of growth in terms of three basic causes of growth:—the rate of capital accumulation, the rate of growth of population, and the rate and nature of technical progress. It passes from a consideration of what determines the rates of change in standards of living at any one point of time to a consideration of the question. The question is: whether the rates of change in standards of living will themselves be rising or falling or will remain at a steady level. The chapter examines this question on the assumption that the basic forces behind the three causes of growth themselves remain constant. It assumes that there are only two factors, capital and labour, and that there is no technical progress. This chapter is concerned simply with an economy in which output is growing as a result of population growth and capital accumulation, without a fixed factor land or technical progress affecting the output.