Technological progress, not capital, drives long-term economic growth, study reveals.
Moving from traditional economic models to newer ones can change how we understand growth in countries like the OECD. While capital accumulation plays a big role in growth, technological progress is the main driver in the long run. A new hybrid model combines both approaches, showing that while capital accumulation is important, productivity growth is also crucial for economic growth. This hybrid model aligns with real-world data on growth accounting and offers a different explanation for how economies grow compared to traditional models.