In the simple Solow growth model, with constant technology and constant returns to scale, GDP per capita can only increase if:

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According to the Solow growth model, an increase in capital results in an increase in output, but the rate of increase in output eventually slows down and reaches a steady state where the increase in capital does not generate any more output. In a steady state, the growth rate of output (GDP per capita) depends on the rate of technological progress and the rate of population growth, which are exogenous variables. Therefore, in order to increase the GDP per capita, the economy needs to increase capital at a faster rate than labour, which can be achieved through investment and savings. Increasing capital at a slower rate than labour or at the same rate as labour will not lead to sustained growth in output per capita in the long run.

In the Simple Solow Growth Model, with Constant Technology and Constant