knowledge and economic growth

Knowledge is the basis for development of technology. Technology development is the basis for economic growth. Therefore, knowledge is the source of energy for economic growth. The greater the base of human knowledge, the greater the payoff of the next discovery. Unlike other assets, knowledge has increasing (vs. diminishing) returns - the more there is the greater the payoff.

Romer (1990) described the ""virtuous cycle of knowledge"" as --

1. the more that is available to invest...
2. the more the investment in technology over time...
3. the richer society gets...
4. the greater the payoff from technology...
5. the greater the incentive to invest in new technology...
6. to to step one...