Theories Of Economic Growth

Abstract

In economics, there are two main areas of theories of economic growth: neo-Keynesian and neoclassical, and accordingly two types of models that characterize it. The neo-Keynesian direction arose on the basis of the ideas of John. M. Keynes about the relative instability of the capitalist economy and macroeconomic equilibrium. The neoclassical direction is rooted in the views of Adam Smith on the self-regulation of the market economy, the factor theory of J.B. Say and the theory of marginal productivity of economic factors of John Bates Clark.