P/E/18. ´Do you accept the argument that research and development is the central cause of economic growth? Explain how innovation systems at the national and corporate level have contributed to the development of major industries.Ž

Abstract R&D is certainly a major factor of economic growth as it has lead to technological improvements that increase the marginal productivity of capital. But it has to be taken into account that there are several other factors that cause economic growth, not just R&D alone. Not only that we must also remember the long-term basis of R&D and that it cannot solve short-term fluctuations, even though investment in it is considered the best method to increase economic growth in the long-run.