All else equal, regions with high capital per worker ratios should exhibit slower rates of growth than regions with low capital per worker ratios.

Question

Quizplus · Accepted Answer

This is because of the principle of diminishing returns to capital; as the amount of capital per worker increases, each additional unit of capital adds less to output than the previous unit, leading to slower growth rates in high capital per worker regions.

All Else Equal, Regions with High Capital Per Worker Ratios