The new growth theory states that

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The new growth theory posits that technological advances result from deliberate choices made by firms and individuals. This is distinct from the old view, which saw technological progress as a serendipitous byproduct of other activities. The idea is that firms invest in R&D to create new technologies that allow them to produce more efficiently or introduce new products, which leads to economic growth. This theory has important implications for government policy, as it suggests that interventions to promote innovation can be effective in spurring economic growth.

The New Growth Theory States That