Neoclassical growth theory accounts for growth in output as a function of growth in
inputs, particularly capital and labor. The relative importance of each input depends
on its factor share.
Labor is the most important input.
Long-run growth results from improvements in technology.
Absent technological improvement, output per person will eventually converge to a
steady-state value. Steady-state output per person depends positively on the saving
rate and negatively on the rate of population growth.
The long-run rate of growth does not depend on the saving rate.
