Knowledge and Growth in the Very Long Run

This paper proposes a theory for the gradual evolution of knowl-edge diffusion and growth over the very long run. A feedback mechanismbetween capital accumulation and the ease of knowledge diffusion explains along epoch of (quasi-) stasis and an epoch of high growth linked by a grad-ual economic take-off. It is shown how the feedback mechanism can explainthe Great Divergence, the failure of less developed countries to attract capitalfrom abroad, and a productivity slowdown in fully developed countries...