Friday, December 23, 2011

MEGA-TECHNIC

'Mega-technic' method of economic growth--increasing economic activity through increases in scope, rather than in efficiency. Doing so makes sense when increasing production is a capital intense endeavor, benefitting existing firms and institutions. As things change, vast capital stocks actually problematic. No longer located in an expanding market, but instead competing for limited resources. In such a context, a vast stock of capital can actually be a competitive weakeness. Developed over time, it naturally includes older, less productive technology. (Institutions also).


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