Cross-Sectional Views of GDP Growth in the Light of Innovations

This paper involves an analysis to investigate the limits to GDP growth in the present economic scenario. One objective of this study is to investigate how innovation alters these limits to economic growth. The present analysis is based on cross-section data. Results show the impact of the size of the economy on GDP growth and the relation between GDP growth and GDP across the world at particular point of time is convex. Growth increases with GDP, reaches its maximum and then begins to decline. There exists some extremum value. This is not exactly middle income trap. It is observed for both developed and developing economies. Actually, countries having this property belong to conventional growth domain. However, the extremum could be extended by technological and policy innovations and some countries move into innovative growth domain with higher limiting values