“we just took in a very simple growth model and in that growth model we saw that well, growth stopped, right. Once we got to 144 machines and an output of 120, we no longer got any growth. So we use that very simple model to get at. A really important fact, that without innovation, if technology stays fixed, growth will stop. Now, sure the labor supply could get bigger, we could have more workers or something like that. But holding the amount of labor fixed and holding that technology fixed, if we’ve got a fixed savings rate, and a fixed rate of depreciation, there’s no more growth at some point. We’re gonna go up, up, up, up, up, and then stop. Well. That hasn’t been human experience right.” – Transcript from Scott Page Coursera
Source:
Scott Page Model Thinking MOOC Course
