Solow model

The Solow model is an economic framework that explains long-term economic growth by examining how capital (like machinery and buildings), labor, and technological progress interact. It shows that increasing capital alone boosts output temporarily, but sustainable growth depends on technological improvements that make workers and capital more productive. Over time, economies tend to grow at similar rates unless there's innovation or increased investment in skills and technology. Essentially, the model highlights the roles of savings, investment, and innovation in raising living standards over the long run.