Asked by Annie Leishman on May 28, 2024

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Studies confirm that controlling for other variables such as the percentage of GDP devoted to investment, poor countries tend to grow at a faster rate than rich countries.

GDP Devoted To Investment

The portion of the Gross Domestic Product that is spent on investments in capital goods, infrastructure, and other activities to promote economic growth.

Poor Countries

Nations with low levels of economic activity, low per capita income, and generally low standards of living.

  • Comprehend the historical patterns in real Gross Domestic Product per capita growth rates around the world.
  • Gain knowledge on topics relevant to economic catch-up, focusing on the catch-up effect and its restrictions.
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RA
Raven ArcangelJun 03, 2024
Final Answer :
True
Explanation :
This phenomenon is often explained by the theory of convergence, which suggests that poor countries have the potential to grow at a faster rate than rich countries because they can adopt existing technologies and practices from wealthier nations, allowing for more rapid economic development and catch-up growth.