endogenous technological change

Endogenous technological change refers to the idea that innovations and improvements in technology arise from within the economy itself, driven by factors such as investments in research and development, education, and knowledge-sharing. Unlike external factors that influence technology from outside the system, endogenous change emphasizes that economic activities and decisions directly generate technological progress. This process can lead to sustained economic growth as better technologies improve productivity, create new industries, and enhance living standards over time. In essence, technological advances are seen as a result of decisions and incentives within the economy, not just external shocks or random discoveries.