The distinction between the short term and the long term is traditional in economics. In the short term, economies are characterized by experiencing economic fluctuations. In the long term, most countries are immersed in a process of sustained growth (at least, the Western countries during the last century and a half or two last centuries) that manifests itself in almost uninterrupted increases in production per worker and of per capita income. What determines the income level of a country and the growth rate of its production per worker and its per capita income? What types of policies can
impact favorably on these variables? Despite the undoubted practical interest in these questions, the incorporation of his study into formal economic theory is a relatively recent phenomenon.
While economic development was one of the central concerns of the classical economists of the nineteenth century, what can be considered the dominant branch of economic theory during the first half of the twentieth century focused on the analysis of essentially static problems. And partly as a result of the great influence that Keynes’s work had since the end of the Second World War, macroeconomists paid more attention to economic fluctuations in the short term than to the causes of long-term economic growth. . Keynes had provided the analytical apparatus necessary to direct economic policy towards the economy and had worried much less about the long term (remember his statement: “in the long term, we will all be dead”). However, from the end of the decade of the fifties, the economy of growth experienced a remarkable development. The literature accumulated during these decades is very extensive and has received a boost in recent years.
Important, both theoretical and empirical (it seems that the “long term” is not as far as Keynes supposed). In relation to its consequences for economic policy, there is a very good reason to try to identify the determinants of economic growth: small variations in the rate of Growth in productivity and per capita income translate into large variations in the income levels of the next generations.
Therefore, understanding the causes and determinants of economic growth can provide quite considerable benefits and, in any case, much higher than those that can be obtained from stabilization policies.