According to the convergence theory, compared to advanced economies, what should be the outcome in less-developed economies?
A) Less-developed economies should grow faster than advanced ones because of the ability of the less-advanced economies to copy new technology.
B) The growth rates of all economies should converge because, in the long run, all resources are alike.
C) Less developed economies should grow slower than advanced ones because they CANNOT copy new technologies.
D) The growth rates of all economies should converge because, in the long run, basic research and applied research converge.

Question

According to the convergence theory, compared to advanced economies, what should be the outcome in less-developed economies?  
A) Less-developed economies should grow faster than advanced ones because of the ability of the less-advanced economies to copy new technology. 
B) The growth rates of all economies should converge because, in the long run, all resources are alike. 
C) Less developed economies should grow slower than advanced ones because they CANNOT copy new technologies. 
D) The growth rates of all economies should converge because, in the long run, basic research and applied research converge.

Quizplus · Accepted Answer

Convergence theory states that in the long run, less-developed economies should grow faster than advanced ones because of the ability of the less-advanced economies to copy new technology. As these economies copy new technologies, they become more productive, leading to faster growth rates. This convergence in growth rates should eventually lead to similar levels of income and development across economies.

According to the Convergence Theory, Compared to Advanced Economies, What