Answer to Question #236424 in Macroeconomics for KAT

Question

explain endogenous growth ? how do endogenous growth model differ from the neoclassical models of growth ?

Answer 1

Endogenous growth theory tends to state that growth within an economy is basically due to inner forces than outside ones. The theory argues that productivity enhancement may be directly tied in fastening innovations as well as investment from private and government institutions.

Endogenous Growth Theory claims that growth within the economy is accumulated internally while neoclassical growth model states that external aspects like technological progress are behind economic growth.