Capital Deepening - Explained
What is Capital Deepening?
Written by J. Mance Gordon
Updated at April 23rd, 2024
- Marketing, Advertising, Sales & PR
- Accounting, Taxation, and Reporting
- Professionalism & Career Development
-
Law, Transactions, & Risk Management
Government, Legal System, Administrative Law, & Constitutional Law Legal Disputes - Civil & Criminal Law Agency Law HR, Employment, Labor, & Discrimination Business Entities, Corporate Governance & Ownership Business Transactions, Antitrust, & Securities Law Real Estate, Personal, & Intellectual Property Commercial Law: Contract, Payments, Security Interests, & Bankruptcy Consumer Protection Insurance & Risk Management Immigration Law Environmental Protection Law Inheritance, Estates, and Trusts
- Business Management & Operations
- Economics, Finance, & Analytics
- Courses
What is Capital Deepening?
When society increases the level of capital per person, we call the result capital deepening. The idea of capital deepening can apply both to additional human capital per worker and to additional physical capital per worker.
Recall that one way to measure human capital is to look at the average levels of education in an economy.
The idea of human capital deepening also applies to the years of experience that workers have.
Growth in technology is another factor leading to capital deepening. It improves the learning methods and abilities of the worker.
This recipe for economic growth—investing in labor productivity, with investments in human capital and technology, as well as increasing physical capital—also applies to other economies.
Related Topics
- Rule of Law relate to Economic Growth
- Labor Productivity
- Productivity and Learning Curve
- Experience Curve
- Acceleration Principle
- Aggregate Production Function
- How to Measure Productivity
- What is the Effect of Sustained Economic Growth?
- How are compound growth rates and compound interest rates related?
- Compound Growth Rate
- Solow Growth Model
- What are the Components of Economic Growth?
- Porter's Diamond
- Physical Capital
- Human Capital
- Infrastructure
- Staple Thesis
- Resource Curse
- Capital Deepening
- What are Growth Accounting Studies?
- What is a Healthy Climate for Economic Growth?
- Economic Convergence
- Emerging Market Economy
- BRIC Countries
- Growth Consensus
- Economic Conditions
- Leading Economic Indicators
- KOF Economic Barometer
- CEO Confidence Survey
- NAB Business Confidence Index