The traditional neoclassical theory of economic growth was first
developed by Robert Solow in his 1956 paper “A Contribution to the Theory of
Economic Growth” (Todaro and Smith, p. 128 and p. 139). In this paper, Solow
argues that economic growth is a function of two inputs- the levels of capital and
labor in a given area. The exact nature of this function is determined by the
technological possibilities available to the society in question (Solow, p. 66).Thus,
under this theory, the economic growth of a given country is determined by the
amounts of labor and capital that country possesses and the technological
possibilities to which that country has access (i.e., the level of knowledge within
that country).