The Search for the Sources of Growth: Areas of Ignorance, Old and New

Many economic historians, like most economists, depend on standard growth accounts to provide some quantitative description of the proximate sources of growth, but this is misleading. American growth experience illustrates the difficulty. The seeming major contribution of tangible capital accumulation to nineteenth-century growth was the consequence of scale-dependent and capital-using technological progress. The large twentieth-century contributions of education and R&D conceal technology's new intangible capital-using bias. Additionally, reverse forces run from capital accumulation to technological progress. Without a greater understanding of these interactions, our knowledge of even the proximate sources of growth is incomplete.