Question #36
Reading: Reading 6 Economic Growth
PDF File: Reading 6 Economic Growth.pdf
Page: 16
Status: Unattempted
Correct Answer: A
Question
Government incentives that encourage private investment in technology and knowledge are most strongly supported by the:
Answer Choices:
A. endogenous growth model
B. neoclassical growth model
C. classical growth model
Explanation
The endogenous growth model hypothesizes that expenditures on R&D and knowledge
capital generate benefits to the economy as a whole, beyond the private benefit to the
investing company. Under the endogenous growth model, the resulting increase in growth
is likely to be enduring.