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The idea that countries poor in capital may grow faster than countries rich in capital and...

The idea that countries poor in capital may grow faster than countries rich in capital and eventually reach similar levels of GDP per capita is?

convergence hypothesis

uniform standard of living hypothesis

steady-state equilbrium

economic development

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Answer #1

Ques: The idea that countries poor in the capital may grow faster than countries rich in capital and eventually reach similar levels of GDP per capita is known as the convergence hypothesis.

It means that the increase in per capita income of the poor countries or countries having less capital is more than that of the richer countries. As a result after a point of time, the per capita income of poor countries will converge to per capita income of richer countries.

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