Abstract

An assault upon the massive problem of economic stagnation fundamentally requires the pursuit of three kinds of basic social and economic changes. First, and perhaps most important, a society must either mobilize domestic savings or attract foreign financing in order substantially to raise its level of investment. This is the problem of financing. Second, these resources must be employed to change production functions in important sectors of the economy to provide increased yields from the utilization of the country's economic endowments. This is the problem of technology. Third, the society must revamp its institutions in such fashion that high levels of savings and investment are perpetuated and the search for new and more productive techniques of production—innovation—becomes a basic social propensity. This is the problem of institutional change.

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