Answer to Question #205607 in Macroeconomics for Allen

Question

Which of the following is probably the most important driver of productivity growth?

(1) Increases in the stock of physical capital.

(2) Increases in the amount of natural resources available.

(3) Increases in the technical means of production of goods and services.

(4) Increases in the population.

(5) Increases in improvements in labor created by the education and knowledge in the workforce.

Answer 1

(5) Increases in improvements in labor created by the education and knowledge in the workforce.

Economist argue that the main driver of productivity growth is innovation.

Through education one can came up with technical means for innovation for production of goods and services and capital which are the drivers for production.