Related to the Economics in Practice on p. 304: According to a study cited in the Economics in Practice, if a country is relatively far from the technological frontier of the rest of the world, its best strategy would be to
A) adopt other countries' policies until it reaches the frontier of the rest of the world.
B) support its own innovative efforts until it reaches the frontier of the rest of the world.
C) first adopt other countries' policies, and as the country approaches the frontier, shift to supporting its own innovative efforts.
D) first support its own innovative efforts, and as the country approaches the frontier, shift to adopting other countries' policies .

Question

Quizplus · Accepted Answer

Countries far from the technological frontier benefit from adopting other countries' policies initially due to the catch-up effect. As they approach the frontier, where the potential for catch-up diminishes, shifting focus to supporting their own innovative efforts becomes more beneficial to sustain growth and competitiveness.

Related to the Economics in Practice on P